The Alliance of American Insurers has written to U.S. Senate Majority Leader Thomas Daschle (D-SD) and Minority Leader Trent Lott (R-MS) urging prompt consideration of the terrorism insurance bill, given the recent high-level predictions of future attacks.
Alliance Senior Vice President of Federal Affairs David Farmer pointed to recent statements by Vice President Cheney, Senate Intelligence Committee Chairman Graham and FBI Director Mueller that indicated more terrorist attacks on U.S. soil are considered a certainty.
Farmer said in his letter, “All of these individuals are responsible for the security of our nation. We, as citizens and insurers, take their remarks very seriously, as they were meant to be taken. Insurers play a vital role in the economic lifeblood of the country, and we too are at risk for another terrorist attack. The nation’s interests are best served by having a viable insurance industry.”
Farmer also addressed the idea held by some Senators that the marketplace is being infused with adequate new capital to meet the demand for terrorism insurance. “While a very restricted terrorism-only insurance market is developing, it is not sufficient to satisfy the extensive needs of the market. There is not enough coverage and the cost of what is available is very high.
“As a result, U.S. businesses are having difficulty obtaining terrorism coverage. Many commentators, from the GAO to Federal Reserve Board Chairman Alan Greenspan, have testified to the serious implications to the economy stemming from of a lack of terrorism insurance,” he wrote.
In concluding the letter, Farmer urged the Senate to act as soon as possible “so that the nation’s insurers can provide the coverage that our policyholders needcoverage to assure a functioning economy in these uncertain times.”
The U.S. House of Representatives passed terrorism legislation in the fall of 2001. The Senate has yet to bring similar legislation to a vote, although a number of bills have been introduced and discussions are ongoing.
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