{ "id": "R43849", "type": "CRS Report", "typeId": "REPORTS", "number": "R43849", "active": true, "source": "EveryCRSReport.com, University of North Texas Libraries Government Documents Department", "versions": [ { "source": "EveryCRSReport.com", "id": 437169, "date": "2015-01-20", "retrieved": "2016-04-06T19:38:26.087375", "title": "Terrorism Risk Insurance Legislation in the 114th Congress: Issue Summary and Side-by-Side Analysis", "summary": "Prior to the September 11, 2001, terrorist attacks, insurance covering terrorism losses was normally included in commercial insurance policies without additional cost to the policyholders. Following the attacks, this ceased to be the case as insurers and reinsurers pulled back from offering terrorism coverage. Some feared that a lack of insurance against terrorism loss would have a wide economic impact, particularly because insurance coverage can be a significant factor in lending decisions. \nCongress responded to the disruption in the insurance market by passing the Terrorism Risk Insurance Act of 2002 (TRIA; P.L. 107-297). TRIA created a temporary program, expiring at the end of 2005, to calm the insurance markets through a government reinsurance program sharing in terrorism losses. This program was intended to give the industry time to gather the data and create the structures and capacity necessary for private insurance to cover terrorism risk. TRIA did not require premiums to be paid for the government coverage. Instead, it required private insurers to offer commercial insurance for terrorism risk, with the government then recouping some or all federal payments under the act in the years following government coverage of insurer losses. \nUnder TRIA, terrorism insurance became widely available and largely affordable and the insurance industry greatly expanded its financial capacity. There has been, however, little apparent success in developing a longer-term private solution, and fears have persisted about the economic consequences if terrorism insurance were not available. Congress passed two extensions to the program, one in 2005 (P.L. 109-144) and one in 2007 (P.L. 110-160). The 2005 extension primarily focused on reducing the government\u2019s up-front financial exposure under the act, whereas the 2007 extension left most of the up-front aspect of the TRIA program unchanged but accelerated the post-event recoupment provisions. The 2007 legislation also included the only expansion of the TRIA program since initial enactment; it extended the program to cover any acts of terrorism, as opposed to only foreign acts of terrorism. \nIn the 113th Congress, both the House and the Senate passed legislation that would have extended TRIA, but differences between the bills prevented enactment. The 113th Congress adjourned without extending the program. Thus, per P.L. 110-160, the TRIA program expired at the end of 2014. Although insurance industry capacity has increased since 2002, many still see terrorism as essentially uninsurable. Without TRIA, the insurance industry indicated that terrorism insurance would again become unavailable or unaffordable. Fears were again being expressed that a lack of terrorism insurance may slow down other sectors of the economy. \nIn the 114th Congress, both the House and the Senate passed the same bill, H.R. 26, and the President signed P.L. 114-1 on January 12, 2015. H.R. 26/P.L. 114-1 extends the program nearly six years while reducing the government\u2019s share of the losses compared with the program as it was in 2014. Specifically, P.L. 114-1 gradually (1) increases the program trigger from $100 million to $200 million, (2) reduces the government share of the losses from 85% to 80%, and (3) increases the mandatory recoupment amount to $37.5 billion.\nThis report briefly outlines the issues involved with terrorism insurance, summarizes extension legislation, and includes a side-by-side comparison of TRIA law and the bills introduced in the 114th and 113th Congresses. For additional information, please see CRS Report R42716, Terrorism Risk Insurance: Issue Analysis and Overview of Current Program, by Baird Webel.", "type": "CRS Report", "typeId": "REPORTS", "active": true, "formats": [ { "format": "HTML", "encoding": "utf-8", "url": "http://www.crs.gov/Reports/R43849", "sha1": "8e031e5cb92938b864fd0617b8966052a9ae8896", "filename": "files/20150120_R43849_8e031e5cb92938b864fd0617b8966052a9ae8896.html", "images": null }, { "format": "PDF", "encoding": null, "url": "http://www.crs.gov/Reports/pdf/R43849", "sha1": "606c4051429d128ef161b34dd158b810c36e72e5", "filename": "files/20150120_R43849_606c4051429d128ef161b34dd158b810c36e72e5.pdf", "images": null } ], "topics": [] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc501779/", "id": "R43849_2015Jan07", "date": "2015-01-07", "retrieved": "2015-03-30T22:03:27", "title": "Terrorism Risk Insurance Legislation in the 114th Congress: Issue Summary and Side-by- Side Analysis", "summary": "This report briefly outlines the issues involved with terrorism insurance, summarizes extension legislation, and includes a side-by-side comparison of the Terrorism Risk Insurance Act of 2002 (TRIA) and the bills introduced in the 114th and 113th Congresses.", "type": "CRS Report", "typeId": "REPORT", "active": false, "formats": [ { "format": "PDF", "filename": "files/20150107_R43849_1ea05278846fc2ab0d9e49a78df751a3a65e2c3d.pdf" }, { "format": "HTML", "filename": "files/20150107_R43849_1ea05278846fc2ab0d9e49a78df751a3a65e2c3d.html" } ], "topics": [ { "source": "LIV", "id": "Terrorism", "name": "Terrorism" }, { "source": "LIV", "id": "Counterterrorism -- U.S.", "name": "Counterterrorism -- U.S." }, { "source": "LIV", "id": "National policy -- U.S.", "name": "National policy -- U.S." }, { "source": "LIV", "id": "Insurance", "name": "Insurance" } ] } ], "topics": [ "Intelligence and National Security" ] }