The bombings in London Thursday came in the midst of a debate in the United States about whether to extend a post-Sept. 11 federal program that provides a financial safety net for the insurance industry against devastating terror-related losses.
The Terrorism Risk Insurance Act of 2002 provides federal coverage of 90 percent of insured losses after a deductible if a terrorist act on U.S. soil directed by foreign interests causes $5 million or more in total damage. The Sept. 11, 2001, attacks resulted in more than $32 billion in damage claims. The act seeks to limit risks to the insurance industry and thus boost the availability of terrorism insurance policies for property owners.
The act is due to expire at the end of this year. Last week Treasury Secretary John Snowe sent a report to Congress saying that insurers no longer needed direct aid from the federal government.
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Source: Knight Ridder Washington Bureau
Posted: Friday, July 08, 2005 12:00:00 AM. Modified: Friday, July 08, 2005 2:05:31 PM.
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