Terrorism insurance legislation may see new life, thanks to federal lawmakers
At the end of 2014, the Terrorism Risk Insurance Act was allowed to expire. This meant that many insurance companies that offered coverage across numerous industries no longer had access to the financial aid offered by the federal government. This aid was meant provide a safety net for the insurance industry and its dealings with acts of terrorism. Because terrorist attacks can be quite costly, the insurance industry had warned that allowing the Terrorism Risk Insurance Act to expire would create many problems for project s in the United States.
Legislation offered financial backstop for the insurance industry and the risks it faces from acts of terrorism
The Terrorism Risk Insurance Act was formed in the wake of the September 11 attacks. The law was designed to provide property insurers with a financial backstop in the event of a terrorist attack. The law had been heavily supported by the real estate industry, especially where commercial projects were concerned. Some insurers had suggested that the federal backstop was necessary, as the lack of financial aid could put developing commercial projects in jeopardy.
Retiring Senator objects to the renewal of federal law
The law was allowed to expire because of the reservations of a single man: Senator Tom Coburn. Senator Coburn is retiring and suggested that the law interfered with the right for states to issue their own terrorism insurance plans. Because of the Coburn’s objections, the law was allowed to expire, largely due to the time constraints that lawmakers faced at the end of 2014. Now, however, the U.S. House of Representatives is set to vote on extending the Terrorism Risk Insurance Act.
House of Representatives aims to renew terrorism insurance legislation
If the House votes to renew the legislation, the matter will be pushed into the Senate. The legislation currently has strong support from Republicans, whom have fast-tracked the legislative process in order to ensure the law is reauthorized in the relatively near future. The insurance industry has also voiced its support for the renewal of the law.