Hours before adjourning for a week-long Thanksgiving recess, the Senate passed by unanimous consent a bill extending the Terrorism Risk Insurance Act (TRIA) for seven years. The Senate measure differs significantly from a bill passed in September in the House. The House bill, which the White House has threatened to veto, renews TRIA for 15 years and contains provisions not in the Senate bill, including extending the backstop to cover group life risks; a mandate that insurers offer coverage for nuclear, chemical, biological or radiological attacks; and a lowering of the program’s trigger level to $50 million from the current $100 million. House Financial Services Committee Chairman Barney Frank (D-Mass.) has insisted he will fight to preserve as much of his chamber’s bill as possible.

PIA supports much of what’s in the House version.

House and Senate negotiators will have to work out differences between the two bills before anything goes to the president. That process will be underway as lawmakers return to Washington following the Thanksgiving break and before adjourning for Christmas. The current TRIA authorization is set to expire on December 31. In October, House Financial Services Committee Chairman Barney Frank (D-Mass.) said he would demand an extension of the current program until April 30 rather than accept a more modest Senate version of the bill. On November 19, Frank said he looked forward to working out a compromise with the Senate.

What It Means to Agents:  Although we were hoping Congress would avoid another last-minute TRIA renewal, this time the renewal will be for at least seven years. PIA will continue to work to reduce the “trigger level” for federal participation from the $100 million in the Senate bill, back to the $50 million in the House version. The lower trigger level will ensure that America’s many regional insurance companies, vital to the success of America’s insurance industry, will remain in good financial standing should terrorists again strike our country.

November 20, 2007