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AIA Views Introduction of Senate TRIA Bill as Step Toward Program's Reauthorization

AIA VIEWS INTRODUCTION OF SENATE TRIA BILL AS STEP TOWARD PROGRAM’S REAUTHORIZATION

WASHINGTON, D.C., April 10, 2014 – Leigh Ann Pusey, president and CEO of the American Insurance Association (AIA), issued a statement in response to the introduction of bipartisan legislation in the Senate to reauthorize the Terrorism Risk Insurance Act (TRIA).

Ms. Pusey’s statement follows:

“AIA commends Senators Schumer, Kirk, Reed, Heller, Murphy, Johanns, Warner, Blunt and Menendez for recognizing the importance of the program and their leadership in introducing long-term TRIA reauthorization legislation in the Senate.  The bill represents a significant step forward toward reauthorization. We look forward to working with the Senate Banking Committee as the process moves forward.

“While we appreciate that this bill creates momentum toward an extension, we do have concerns with the legislation.  In particular, the insurer co-share increase to 20 percent, even phased-in over five years, could lead to decreased market capacity.  A key point is that any legislation to reauthorize TRIA must protect the balance achieved by the program and not introduce higher retentions on companies that could end up hurting their individual ability to offer insurance coverage to U.S. businesses, including terrorism risk coverage. 

“TRIA is an effective partnership between private market insurers and the federal government that provides for an orderly economic recovery in the event of a terrorist attack.  The program maximizes private market risk bearing while protecting taxpayers at every step.  By placing the financial recovery on the private market in all but the most catastrophic of attacks, TRIA protects the federal government and taxpayers from this potential exposure.   

 “AIA looks forward to working with the Senate Banking Committee and Members of Congress to pass TRIA reauthorization legislation that protects policyholders and taxpayers while ensuring the continued widespread availability of property-casualty insurance for terrorism risks.  We are confident that TRIA will be reauthorized in 2014 with strong bi-partisan support.”

The bill, cosponsored by Senators Charles Schumer (D-NY), Mark Kirk (R-IL), Jack Reed (D-RI), Dean Heller (R-NV), Chris Murphy (D-CT), Mike Johanns (R-NE), Mark Warner (D-VA), Roy Blunt (R-MO) and Robert Menendez (D-NJ), will renew the program for seven years.  However, the legislation increases the program’s recoupment mechanism by $10 billion, $2 billion per year over five years, to $37.5 billion.  In addition, it increases the insurer co-share from 15 percent to 20 percent over a five-year phase-in period. 

TRIA was first authorized in 2002 following the terrorist attack of September 11, 2001. It was subsequently reauthorized in 2005 and 2007 with broad bipartisan support, and is scheduled to sunset on December 31, 2014.  In addition to the newly introduced Senate bill, three TRIA reauthorization bills, H.R. 508, H.R. 1945 and H.R. 2146, have been introduced in the U.S. House of Representatives.

Please contact Will Rijksen if you would like to schedule an interview.

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The American Insurance Association (AIA) is the trade association for today’s leaders in the property-casualty insurance industry. Our members work each day to protect the American Dream, whether that’s a house, car, business or otherwise. Now more than 150 years old, AIA has an unparalleled record of advocating on state, federal and international issues for insurers and their customers. 

Our membership is comprised of more than 330 companies, collectively writing more than $134 billion in premiums each year.

We have the experience of a veteran organization coupled with the innovative ideas that drive our industry forward. AIA is leading the insurance industry into the second half of the 21st Century… today.


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Media Contacts

Maggie Seidel
VICE PRESIDENT, PUBLIC AFFAIRS
(202) 828-7196
mseidel@aiadc.org

Rachel Wallen
PUBLIC AFFAIRS MANAGER
(202) 828-7149
rwallen@aiadc.org

 

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