The U.S. House voted Dec. 10 to extend by six years a federal backstop for insurers offering coverage against terrorism, advancing efforts to retain a program created in response to the attacks of Sept. 11, 2001.
House lawmakers passed the Terrorism Risk Insurance Act extension today in a 417-7 vote that sends the measure to the Senate. Approval there would move the measure to President Barack Obama for final approval.
Representative Jeb Hensarling, a Texas Republican, and Senator Charles Schumer, a New York Democrat, agreed this week on an extension that would see insurers get reimbursements after industrywide losses in a terror attack reach $200 million from $100 million. The measure would increase companies’ co-payments to 20 percent from 15 percent and gradually raise the threshold for government involvement.
The bill includes a change to the Dodd-Frank Act to exempt firms that trade commodity futures to hedge commercial risk from margin requirements and a requirement that the Federal Reserve have a governor with community banking experience.
The Obama administration released a statement today opposing inclusion of the derivatives amendment, saying the measure “should not be used as a vehicle to add entirely unrelated financial regulatory provisions.”
Supporters of TRIA renewal include most major businesses and the property/casualty insurance industry.
Property Casualty Insurers Association of America President and CEO David Sampson said in prepared remarks that his organization “applauds” the House for passing the bill, which follows Senate passage of a slightly more generous measure six months ago.
“PCI is grateful that members of both chambers came together on a bipartisan basis and adopted a hard won compromise,” Sampson said. He urged the Senate to pass the bill and send a final TRIA reauthorization to President Obama’s desk as soon as possible, before the current law expires on Dec. 31.
Leigh Ann Pusey, president and CEO of the American Insurance Association (AIA), said her organization “strongly supports a long-term reauthorization of TRIA by year-end,” and that the House vote affirmed “significant Congressional support for a long-term reauthorization.”
The legislation is S.2244: Terrorism Risk Insurance Program Reauthorization Act of 2014.
*Carrier Management, a sister publication of Insurance Journal, contributed to this story.
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Cyber Attacks on Banks Color Terrorism Insurance Renewal Debate
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