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Treasury Issues More Interim Guidance on TRIA

The U.S. Treasury Department has issued its third bulletin designed to assist insurers in determining how they may comply with certain aspects of the Terrorism...
January 28, 2003

The U.S. Treasury Department has issued its third bulletin designed to assist insurers in determining how they may comply with certain aspects of the Terrorism Risk Insurance Act (TRIA) prior to final regulations being issued. The interim guidance provides a safe harbor to assist compliance with time-sensitive issues including: a) disclosure requirements at the time of offer, purchase and renewal of the policy and b) "separate line item" requirements for policies issued more than 90 days after date of enactment.

What It Means to Agents:  The new guidelines recognize that there is no one set of answers for the many questions carriers and agents may have about compliance challenges, when faced with questions from their clients. Indeed, Treasury states that the required disclosures can be made using the channels, methods and form of communication that the carrier uses in its regular course of business to communicate similar policyholder information. Therefore, PIA's advice to members remains the same: producers should contact each of their carriers for instructions because each carrier may have different procedures and interpretations, all of which may be valid.

Background:  In last week's meeting hosted by the American Insurance Association (AIA), Treasury reinforced its desire to work with the industry to ensure that the requirements are not onerous and, to the extent possible, conform to the carrier's normal business practices. Furthermore, Treasury indicated that it intends to issue interim rules in the near future. These interim rules are expected to consist of the interim guidance it has issued along the way. Industry will be given an opportunity to comment on the interim rules before they become final.

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