Archive: News

WASHINGTON, D.C. - U.S. Representative Michael A. Arcuri (D-Utica) voted for legislation Wednesday to extend federal assistance for private terrorism insurance - continuing a critical program through which the federal government coordinates with insurers to provide financial compensation for losses from acts of terrorism.

"Protecting the safety and security of Americans is, without question, our top priority in Congress. The horrible terrorist attacks of September 11th, 2001, had a devastating effect on so many people in this country," said Arcuri, who managed the floor debate on the resolution providing for consideration of the Terrorism Risk Insurance Revision and Extension Act. "This is an issue that has a direct impact on our local economy. In the year that followed the September 11th attacks, Utica First saw the volume of the policies they were writing in the New York City area increase 27 percent, as other companies ceased offering coverage. Small companies like this, that continued to offer coverage, are to be commended for taking on greater risk exposure in order to provide this necessary coverage. I am proud to stand here today watching out for the interest of our nation's business community by providing much-needed stability in the terrorism risk insurance market."

Wednesday afternoon, the House passed the Terrorism Risk Insurance Revision and Extension Act (H.R. 2761), which would reauthorize the Terrorism Risk Insurance Act (TRIA) for 15 years - through 2022. TRIA provides a federal backstop to the insurance industry by providing compensation for a portion of insured losses resulting from acts certified by the government as acts of terrorism. TRIA has no cost to taxpayers unless there is a terrorist attack.

In 2002, TRIA was enacted in an attempt to stabilize the economy that was badly disrupted by the tragic events of 9/11 and to spur commercial development, as well as to prevent an insurance industry-wide catastrophe in the event of another terrorist attack. The law was reauthorized with some changes in 2005 (PL 109-44) and will expire on December 31, 2007. The 15-year extension will stimulate economic development by providing certainty that terrorism insurance will be available for long-term construction projects.

H.R.2761 includes a critical expansion of TRIA to cover both foreign and domestic terrorism. TRIA currently covers only foreign terrorism. It also adds group life insurance to the types of insurance for which terrorism insurance coverage must be made available by insurers. Under current law, group life carriers face insolvency if a terrorist event affects a large group of people.

H.R. 2761 also broadens TRIA to include acts of nuclear, biological, chemical, and radiological terrorism. Studies by the President's Working Group on Terrorism and the GAO have concluded that the risk of nuclear, biological, chemical and radiological terrorism is essentially uninsurable absent a federal government backstop. Currently, the insurance market for nuclear, biological, chemical and radiological terrorism coverage in the United States is virtually nonexistent.

The bill sets the "trigger" level - the size of an attack at which the federal government would provide aid to insurers - at $50 million. Current law, enacted in 2005, sets the level at $50 million in 2006 and $100 million in 2007.

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