The National Association of Mutual Insurance Companies (NAMIC) issued the following statement on the Feb. 27 House Financial Services Committee hearing: “How much are Americans at risk until Congress passes terrorism insurance protection?”
“NAMIC seeks a terrorism backstop not to mitigate losses that have already occurred, but to try to protect against the risk of future terrorism-a risk which cannot be measured and hence, cannot be priced,” Monte Ward, NAMIC’s vice president federal affairs, commented. “Insurance spreads risk. Risk that cannot be quantified cannot be spread with any precision or confidence. It is critical that Congress pass a terrorism insurance plan that will facilitate the availability of appropriate insurance mechanisms to cover terrorism-related events.
“We are pleased that Chairwoman Kelly has conducted this hearing, and we applaud Chairman Michael Oxley and Capital Markets Subcommittee Chairman Richard Baker, for getting H.R. 3210, the Terrorism Risk Protection Act, passed through the House late last year,” Ward said. “We will continue to work with Congress to get a backstop put into place.”
The hearing, led by Oversight and Investigations Subcommittee Chairwoman Sue Kelly, R-NY, presented a panel of witnesses who testified on the need for a federal program to back up private insurance providers for coverage of terrorist attacks.
The subcommittee also reviewed the findings of a General Accounting Office study on the impact of Sept. 11 insurance losses on the U.S. economy and the capacity of the current market to absorb any future losses.
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