Following an overwhelming show of support in the U.S. Senate, there is now now one more feather in the cap of the Terrorism Risk Insurance Program Reauthorization Act.
With 93 out of the 100 total senators in favor of passing the bill, it now moves on to the House of Representatives for an additional vote, according to Insurance Journal. This current iteration of TRIA was introduced in April of this year and would extend the federal backstop for terrorism losses for another seven years. First passed back in 2002 in response to the Sept. 11 terrorist attacks, the legislation helps the commercial insurance marketplace handle insurance claims totaling over $100 million for one incident.
"Before TRIA, the risk of terrorism and the lack of available coverage ground commercial development almost to a halt, costing billions of dollars and thousands of lost jobs," Jimi Grande, senior vice president of federal and political affairs for the National Association of Mutual Insurance Companies, said in a news release. "Now, more than 60 percent of companies in the United States have coverage in place, and major construction and development continues to take place across the country."
Even with the show of support in the Senate, there are still pros and cons to a TRIA renewal. Insurance Journal explained that opponents believe that insurers can manage losses on their own. In addition, some feel that limiting TRIA's reach is ideal, possibly extending it for fewer years or developing a new bill altogether.
Organizations applaud Senate vote
While debate over TRIA's merits continues, many national organizations have come out to applaud the recent Senate vote. The Risk and Insurance Management Society is one such group, stressing the importance of TRIA not only for the insurance industry here in the U.S. but across the world as well.
"A common misperception is that TRIA only impacts organizations here in the United States," RIMS president Carolyn Snow said in a statement. "Any global business that has facilities, employees or components of their supply chain here in the U.S. will be affected should TRIA expire. This is a worldwide insurance issue."
RIMS pointed to the bill's ability to stabilize the industry following an incident. It would be possible for the program to provide a quality method to respond to claims and help companies avoid bankruptcy should they be impacted by a terrorist attack.
