Terrorism Risk Insurance Revision and Extension Act of 2007

Press Release

TERRORISM RISK INSURANCE REVISION AND EXTENSION ACT OF 2007 -- (House of Representatives - September 19, 2007)

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Mr. LARSON of Connecticut. Mr. Chairman, today I rise in strong support of H.R. 2761, the Terrorism Risk Insurance Revision and Extension Act of 2007, which would reauthorize the Federal terrorism insurance program (TRIA) for 15 years.

I am pleased that the years spent working on this issue with constituents, the insurance industry, and the financial services industries to build a consensus has produced a bill so widely supported by Members in the House on both sides of the aisle that has the strong support of the business community. I applaud Chairman FRANK, the members of the House Financial Services Committee, and Representative CAPUANO, the chief sponsor of the bill, for their leadership in crafting this critical legislation protecting the safety and security of America.

It is estimated that the September 11th terrorist attacks resulted in $40 billion in insured claims, the largest man-made insurance disaster on record. After the 9/11 attacks, given the size of potential liabilities, there was growing concern that insurance companies and reinsurers might not be able to write policies to insure losses due to future acts of terrorism. As a result, the TRIA program was enacted in 2002 in an attempt to prevent an industry-wide catastrophe in the event of another domestic terrorist attack. The TRIA program 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. The law was reauthorized with some changes in 2005 (P.L. 109-44) and will expire on December 31, 2007.

Currently, TRIA only covers foreign terrorism; however, this bill would extend TRIA coverage to both foreign and domestic terrorism. The bill would set the ``trigger'' level--the size of an attack at which the Federal Government would provide aid to insurers--at $50 million. According to studies from the Government Accountability Office (GAO), the risk of nuclear, biological, chemical and radiological terrorism is uninsurable absent a Federal Government backstop. In response, this legislation would include acts of nuclear, biological, chemical, and radiological terrorism in TRIA. The bill would also add group life insurance to the types of insurance for which terrorism insurance coverage must be made available by insurers. Finally, H.R. 2761 would create a 21-member ``blue ribbon'' commission to propose long-term solutions to covering terrorism risk. The goal of this legislation is to protect America's economy during a time of national crisis and is important to the economic security of the business community in Hartford and the Capital Region.

I urge my colleagues to vote in favor of final passage and for the President to sign this bill into law. The continued insurance and safety of our Nation against terrorist attacks is an urgent and bipartisan issue.

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