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House Committee Passes 5-year TRIA Extension

A divided House Financial Services Committee advanced to the House floor a bill that reauthorizes the Terrorism Risk Insurance Act for five years, but it puts it on a path toward phasing out, after five years, the federal backup for terrorism risk insurance for attacks except for nuclear, biological, chemical, and/or radiological events...
June 27, 2014

A divided House Financial Services Committee advanced to the House floor a bill that reauthorizes the Terrorism Risk Insurance Act (TRIA) for five years, but it puts it on a path toward phasing out, after five years, the federal backup for terrorism risk insurance for attacks except for nuclear, biological, chemical, and/or radiological (NBCR) events. The measure passed on a largely party-line vote of 32-27.

“PIA applauds the U.S. House Financial Services Committee’s action to advance the reauthorization of TRIA and urges the full House to follow suit,” said PIA National Director of Federal Affairs Jon Gentile. “We are pleased that some of our efforts are reflected in the bill (H.R. 4871), such as a longer reauthorization. As the process moves forward, PIA will continue to advocate for a lower trigger level to ensure the widest possible availability and affordability of terrorism insurance for consumers. It is important to keep the program at a point where all insurers, small and large, have an opportunity to participate and are not priced out.”

The insurance industry generally prefers the Senate version that extends TRIA for seven years and is more consistent with the current program. H.R. 4871 made it out of the Financial Services Committee with only Republican support, and there is a potential that Republicans from urban districts could join with Democrats to push through legislation more in line with the bill reported out June 3 by the Senate Banking Committee.

Legislation establishing the National Association of Registered Agents and Brokers (NARAB II) was added to the House bill reauthorizing TRIA.

“PIA supports NARAB II, however we are concerned that the Federal Insurance Office (FIO) has said that it will monitor its establishment and implementation ‘consistent with its [the FIO’s] authority,’” Gentile said. “PIA believes the FIO has no such authority, and that authority for NARAB II should never be granted to the FIO.” Meanwhile, a perennial congressional supporter of federal insurance regulation doesn’t like the idea of state insurance regulators having authority under NARAB II. Rep. Ed Royce (R-Calif.) said the National Association of Insurance Commissioners (NAIC) has too much power to advise presidents in picking members of the governing body of NARAB.

“We look forward to working with the full Senate and House to pass a long-term reauthorization of TRIA as soon as possible,” Gentile said.

Divided House Committee Advances Controversial 5-year TRIA Extension (National Underwriter 6/20)

Industry Groups Happy with TRIA Progress, If Not the Current Version (National Underwriter 6/20)

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