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NAMIC Applauds House Passage of TRIA Legislation, Urges Swift Senate Action

WASHINGTON (Sept. 19, 2007) – Bipartisan legislation to extend the terrorism insurance backstop for 15 years is a good first step on this important issue, said the National Association of Mutual Insurance Companies. The measure, H.R. 2761, passed the U.S House of Representatives by a vote of 312 to 110.

“We commend members of the House for advancing this critical piece of legislation,” said Marliss Browder, NAMIC’s senior federal affairs director. “While we wholeheartedly endorse many of the provisions in the bill, we remain concerned that the inclusion of a mandate for insurers to offer coverage for non-conventional weapons could jeopardize the ability of small and medium-sized insurers to offer terrorism coverage – to the ultimate detriment of policyholders.”

The bill would require insurers that offer terrorism coverage to make available insurance for losses from attacks by nuclear, biological, radiological and chemical agents. Such events are considered uninsurable for many insurers.

“We continue to believe that attacks using NBCR weapons would likely be so devastating to American society that the question of how to deal with them would be best served by creating a special panel to examine all the issues involved with such attacks.”

Browder said NAMIC was pleased with other elements of the legislation, including:

  • A reduced event trigger for federal involvement, from $100 million to $50 million, and to $5 million for a second event following an initial industry terrorism loss of more than $1 billion.
  • Lower insurer deductibles for conventional terrorism, from 20 percent to 5 percent, if another conventional attack exceeds $1 billion.
  • Extending the program for 15 years.
  • A reduced insurer co-pay for NBCR terrorism events, from 15 percent to as low as zero, as the size of insurer losses increase.
  • An opportunity for some smaller insurers to seek opt-out permission from the NBCR make available requirement where compliance with the requirement would lead to insolvency in the event of certain attacks.

“We appreciate the hard work by members of the House to get this legislation on the right track to enable all property/casualty insurers to participate in the program,” Browder said. “We look forward to working with members of the Senate to quickly pass this vital legislation, as time is of the essence. The current law is set to expire Dec. 31, less than four months from now.”

For further information, contact
Nancy Grover
(202) 628-1558 Tel
(202) 628-1601 Fax
ngrover@namic.org

Posted: Wednesday, September 19, 2007 12:00:00 AM. Modified: Friday, September 21, 2007 10:28:32 AM.

317.875.5250 - Indianapolis  |  202.628.1558 - Washington, D.C.

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