S. 2600 Faces New Battle

June 20, 2002

While insurers can breathe a little easier with the Senate’s recent passing of the terrorism insurance bill, a new quarrel has developed over whether businesses should be protected from paying punitive damages, according to the Associated Press.

The legislation gained passage with an 84-14 vote by the Democratic-dominated Senate, yet declined to allow companies to be protected from punitive damages, contradicting legislation that was passed by the Republican-dominated House last November limiting lawsuits and banning punitive damages.

Both bills provide government backstops for insurers in the event another terrorist attack were to take place, leaving the companies to cover billions of dollars in claims.

The Republicans maintain that Democrats are attempting to shield some of their major contributors, the trial lawyers. Democrats contend that Republicans are looking out for their major GOP donors.

President Bush said that any legislation has to include limits on lawsuits.

Senate Democrats are willing to compromise with the House Republicans to assure passage of the bill.

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