Senators Kirk, Heller Urge Renewal of Terrorism Risk Insurance Act

Call on Banking Committee to Provide Certainty to Employers, Insurers

WASHINGTON—(ENEWSPF)—December 16, 2013. U.S. Senators Mark Kirk (R-Ill.) and Dean Heller (R-Nev.) today urged the Senate Banking Committee to provide certainty to businesses that purchase terrorism risk insurance by beginning work on reauthorizing the Terrorism Risk Insurance Act (TRIA) when Congress reconvenes in January. In a letter to Committee Chairman Tim Johnson (D-S.D.) and Ranking Member Mike Crapo (R-Idaho), Senators Kirk and Heller urged swift consideration of legislation to renew TRIA, which is set to expire at the end of next year.

“As our state economies begin to slowly improve, the biggest request we hear from our employers is the need for certainty,” Senators Kirk and Heller wrote. “Unfortunately, the threat of TRIA expiration is a constant concern for many businesses throughout our states, particularly in Las Vegas and Chicago, where the threat of a terrorist attack is always high. The possible expiration of TRIA coverage threatens the economic recovery for many of our constituents, especially those in the event, travel, and tourism industries.”

TRIA was enacted in 2002 following the September 11, 2001, terrorist attacks, and has been reauthorized twice, in 2005 and 2007. The law is set to expire on December 31, 2014, though insurers are already beginning to write policies for 2015. TRIA establishes a federal backstop for catastrophic terrorism-related losses and helps protect American consumers, businesses, taxpayers and the U.S. economy in the event of a catastrophic terrorist attack.

Terrorism risk, unlike other forms of insured risk, is not a fully insured event because the frequency and related costs of terrorist attacks are difficult to predict. The federal backstop enables insurance companies to offer terrorism risk insurance for many risks that would otherwise not be insured.

The full text of the letter can be found below.

December 16, 2013

Dear Chairman Johnson and Ranking Member Crapo,

As the Senate approaches the second session of the 113th Congress, we write regarding the Senate Banking Committee’s timing for consideration and markup of the Terrorism Risk Insurance Act (TRIA).  As you know, TRIA is set to expire on December 31, 2014, and insurers, many of who are writing policies for 2015 and future years, are already feeling the impact of this uncertainty, as are those whom they insure. 

Missed deadline after deadline have been the staple of this Congress, and both parties have too often been playing brinksmanship politics.  This is no way to govern.  Instead of waiting until expiration is upon us, we ask that the Committee begin to work on legislation reauthorizing TRIA when Congress reconvenes in January.

We represent states with major sectors directly impacted by TRIA, including insurers, reinsurers, hotel, and entertainment businesses. Further, representing states with the highest and fourth highest unemployment rates in the county, our top priority is job creation.  As our state economies begin to slowly improve, the biggest request we hear from our employers is the need for certainty.  Unfortunately, the threat of TRIA expiration is a constant concern for many businesses throughout our states, particularly in Las Vegas and Chicago, where the threat of a terrorist attack is always high.  The possible expiration of TRIA coverage threatens the economic recovery for many of our constituents, especially those in the event, travel, and tourism industries.

Both of us greatly appreciate your bipartisan work on housing finance reform and believe that the Committee should continue to focus on this important issue.  While housing finance reform progresses, and with the last of the hearings on housing finance reform complete, it is our hope that the Committee will make TRIA reauthorization a timely and top priority of the Committee for this coming session of Congress. 

We appreciate your consideration of our request, and we look forward to working with both of you to find a responsible, bipartisan agreement to reauthorize TRIA.

Sincerely,

U.S. Senator Mark Kirk
U.S. Senator Dean Heller

Source: kirk.senate.gov