Summary
Cover Report: Legislative/Regulatory - Terrorism Risk Insurance Act of 2002 helps businesses recover from terrorist attacks - Statistical Data Included
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Extract
Rebooting terrorism insurance.
Something had to be done to confront the post-Sept. 11 crisis of unavailable and/or unaffordable terrorism insurance coverage for commercial real estate. The U.S. Congress was heading toward a potential fix during the summer, but a congressional recess will delay further action until late September at the earliest. Meanwhile, the problem continues to aggravate an economy wavering between recovery and relapse.
THE NEWS WAS ALARMING EARLY THIS YEAR, and except for a few bright spots, was getting worse with each passing month. During the first quarter of 2002 alone, commercial real estate construction in the United States plunged 20 percent, according to the U.S. Commerce Department. The Bond Market Association, Washington, D.C., reported that more than $7 billion worth of commercial mortgage-backed securities (CMBS) were suspended or canceled. The White House reported 79,000 jobs lost in real estate and construction in April alone, blaming terrorism-insurance market uncertainty and property owners' difficulty securing adequate coverage. More recently, the Labor Department reported that 30,000 construction industry jobs were lost in July. The news on construction and commercial real estate was mainly bad and getting worse. Then on June 18 there was good news to offset some of the rising anxiety over the black...See the full content of this document
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