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TRIA clears House; just a Senate vote away from long-term extension.

Byline: NU Staff

On Wednesday, the U.S. House of Representatives passed H.R. 26, the "Terrorism Risk Insurance Program Reauthorization Act of 2015" during the first days of the 114th Congress by a 416-5 bipartisan vote.

If signed into law, this legislation will extend for six years the Terrorism Risk Insurance Act (TRIA) program, which expired Dec. 31, 2014--leaving much of the commercial property & casualty market at severe financial risk from a terrorist attack.

The bill includes the National Association of Registered Agents and Brokers (NARAB II) legislation that would establish a permanent NARAB to streamline agent licensing to benefit small businesses and many insurance consumers.

P&C industry organizations and associations were quick to applaud the House's actions, and urged the Senate to act.

"This bipartisan action today by the House is vitally important to instill confidence in markets that this new Congress will quickly act to reauthorize the TRIA program that has protected the U.S. economy since its inception in 2002," Big "I" president & CEO Bob Rusbuldt said in a statement. "This bill is imperative for stability in the

insurance, real estate and lending markets, as well as providing needed agent and broker licensing reform on a voluntary basis.

"We ask that the Senate pass this crucial legislation as quickly as possible so it can be sent to President Obama's desk to be signed into law," Rusbuldt added.

In addition to reauthorizing the TRIA program for six years, the bill would also raise the trigger amount needed in total losses before the TRIA program kicks in from the current $100 million to $200 million, over five years, beginning in calendar year 2016, the Big "I" noted. Also over five years, starting Jan. 1, 2016, the mandatory recoupment would also go from $27.5 billion to $37.5 billion, increasing by $2 billion each year.

For all events, the bill would raise the private industry recoupment total from the current 133% of covered losses to 140% of covered losses.

The Big "I" also expressed its approval that the House TRIA bill once again includes the National Association of Registered Agents and Brokers legislation (NARAB II). "Now it is imperative that the Senate act, and act quickly," says says Charles Symington, Big "I" senior vice president of external and government affairs.

The National Association of Professional Insurance Agents (PIA) commended the House's passage of a long-term TRIA extension. "This legislation provides the certainty that America's businesses and insurance consumers need," said PIA National Executive Vice President & CEO Mike Becker. "We urge the Senate to pass this bill without delay."

"The House is off to a good start," added PIA National Director of Federal Affairs Jon Gentile. "The Senate should quickly follow suit."

"We are appreciative of the House's quick action this afternoon to reauthorize TRIA for six years," said Ken A. Crerar, president/CEO of The Council of Insurance Agents & Brokers (CIAB). "We are extremely grateful to House leadership, Chairman Hensarling, Subcommittee on Housing and Insurance Chairman Neugebauer and Rep. Waters, for seeing this through. We continue to urge their counterparts in the Senate to act quickly to pass this critical legislation. Allowing TRIA to expire was a dangerous gamble that puts current terrorism policies in peril and poses significant risk to economic growth and American jobs."

Charles M. Chamness, president and CEO of the National Association of Mutual Insurance Companies (NAMIC), said, "This legislation strikes the right balance between protecting the taxpayers and keeping the TRIA program within reach of those companies that operate on a regional or single-state basis. A more drastic increase to the threshold for federal intervention may have kept many of those companies from providing terrorism coverage, leaving fewer options and increased rates for consumers."

"Only a long-term reauthorization of TRIA will restore market certainty and protect our economy against major acts of terrorism," said Leigh Ann Pusey, president and CEO of the American Insurance Association (AIA). "We urge the Senate to quickly pass the bill in order to restore market certainty and protect our economy against terrorism."

Members of the Coalition to Insure Against Terrorism are "pleased Speaker Boehner, Majority Leader McCarthy and Chairman Hensarling have made TRIA reauthorization a top priority for the new Congress and commend the members of the House for quickly approving this important legislation," said CIAT spokesman Marty DePoy. "It's now time for the Senate to follow the House's lead and immediately renew this program that's proven so critical to U.S. economic and national security."
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Publication:Property and Casualty 360
Date:Jan 7, 2015
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