The House overwhelmingly approved bipartisan legislation that would extend and revise the Terrorism Risk Insurance Act (TRIA) for an additional two years.
Approved by a 371-49 vote, the Terrorism Risk Insurance Revision Act of 2005 (TRIRA), H.R. 4314, would provide full, mandatory taxpayer reimbursement for federal assistance provided under the program, while significantly raising the deductibles and co-shares over current program levels. The legislation would also narrow the program in anticipation of its phase-out.
House Financial Services Committee Chairman Michael G. Oxley (R-Ohio) called the passage of H.R. 4314 an important step in protecting taxpayers and ensuring the continued availability of terrorism insurance.
"This is strong legislation that requires the insurance industry to pay back all assistance provided by the federal government, and promotes the creation of private-market solutions," said Oxley. "[The insurance] industry has been slow to respond, so Congress must uphold its duty to the taxpayers by making this program pay for itself."
The original TRIA was enacted in November 2002 in the wake of the Sept. 11, 2001, terrorist attacks, as a temporary program to share future insured terrorism losses with the property-casualty insurance industry and policyholders. TRIA was designed to allow commercial mortgage borrowers to obtain terrorism insurance coverage at a reasonable cost, while satisfying terrorism insurance requirements of commercial servicers. By law, it expired on Dec. 31, 2005.
The Mortgage Bankers Association (MBA), which supports the crafting of a permanent solution for terrorism insurance...