Reps. Grimm, Maloney Introduce Terrorism Risk Insurance Act (TRIA) Reauthorization
|Targeted News Service|
"After years of working in counterterrorism, I fully recognize not only the risk of a terrorist attack, but the significant economic impact it could have on communities across the country. TRIA is critical as we continue to combat terror around the world, ensuring that victims can focus on what really matters--caring for those impacted and rebuilding their lives--instead of worrying about how to cover the costs of damage. I am proud to join with this bipartisan group to introduce the TRIA Reauthorization Act and ensure there is no lapse in coverage for communities, businesses or families that could be hurt by an act of terrorism," said Rep. Carson.
"TRIA is essential to stabilizing the market for terrorism risk insurance and has provided certainty for
"Through TRIA, the federal government has demonstrated it can play a positive role in spurring necessary, private market insurance. I am a cosponsor of this legislation because I believe these kinds of backstops are one of the best ways to protect the taxpayer from bailouts and encourage communities at risk to take steps needed to protect against future insurance claims," said Rep. Ross.
"I am proud to be an original cosponsor of the Terrorism Risk Insurance Act to provide a system of shared public and private compensation for insured losses resulting from acts of terrorism. This legislation is critically important to ensure that construction projects, lending, and other activities vital to our continuing recovery will not be jeopardized," said Rep. Bishop.
"At almost no cost to the taxpayer, the national terrorism insurance program has made it possible for more than a decade for businesses to purchase terrorism risk coverage. Having a federal terrorism insurance public/private risk sharing partnership in place in advance ...allows for the timely and orderly payout of claims to the victims of terrorism after an attack, thereby reducing or eliminating ultimate taxpayer exposure and minimizing the economic fallout from the next terrorist attack.
Before the terrorist attacks of
An individual act of terrorism must be certified jointly by the Secretary of the Treasury,
Each insurer is responsible for paying out a certain amount in claims--known as its deductible--before receiving federal coverage. An insurer's deductible is proportionate to its size, equaling 20% of an insurer's annual direct earned premiums for TRIA-covered lines of insurance. Once the
In addition, TRIA contains important taxpayer protections. In the event of government losses due to an act of terrorism the Treasury is able to recoup losses by applying a surcharge to future insurance premiums to repay these losses over time.
If TRIA were to lapse at the end of 2014 billions, possibly trillions, in commercial loans that are required to have terrorism insurance would be in technical default and could be called in, creating a massive financial and economic disruption.
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