Should Congress Speed Up Its Push for Terrorism Protection?

The Terrorism Risk Insurance Act doesn’t expire until the end of the year, but supporters want to reauthorize it as soon as possible.

National Journal
April 14, 2014, 8:04 a.m.

How do you get the “least pro­duct­ive” Con­gress to speed up its fight over ter­ror­ism in­sur­ance?

The Ter­ror­ism Risk In­sur­ance Act is set to ex­pire at the end of this year un­less Con­gress reau­thor­izes the le­gis­la­tion. Those con­cerned that ter­ror­ism risks re­main high feel pres­sure to en­sure that a gov­ern­ment back­stop re­mains, but that means get­ting Con­gress to agree on something way ahead of dead­line.

TRIA was en­acted in 2002 as a re­sponse to the 9/11 ter­ror­ist at­tacks. It’s a pub­lic-private part­ner­ship that re­quires private in­sur­ance com­pan­ies to provide ter­ror­ism risk cov­er­age, with fed­er­al fund­ing as a back­stop if costs to in­sur­ance com­pan­ies ex­ceed $100 mil­lion. The law was re­newed in 2005 and 2007.

Ex­perts and law­makers agree that the nature of ter­ror­ism risk in­sur­ance raises a unique set of con­cerns and time frame for the de­bate.

“We hear a lot that [TRIA] doesn’t ex­pire un­til the end of Decem­ber. In real­ity, people are mak­ing de­cisions now on new pro­jects,” Rep. Randy Hult­gren said Monday at a Na­tion­al Journ­al Live event un­der­writ­ten by Zurich. “It doesn’t help us at all to get closer to that date.”

“The unique­ness of this, the risk of this, the un­cer­tainty is un­like everything else,” the Illinois Re­pub­lic­an con­tin­ued. “It hurts that the con­gres­sion­al ap­prov­al rat­ing is so low. We have to get to the point that people trust us, that we’re go­ing to do our home­work and make good de­cisions.”

Hult­gren sup­ports a re­new­al of the law, and em­phas­izes this needs to get done — and fast. But even among those who be­lieve the law should be ex­ten­ded, de­bate per­sists over the de­tails and the ex­tent of gov­ern­ment fund­ing.

Crit­ics of TRIA ar­gue that the law places a bur­den on tax­pay­ers, and puts an un­due cost on those liv­ing in rur­al areas with less of a ter­ror­ism threat. Some say that costs should be more heav­ily on the private sec­tor, with less pub­lic in­volve­ment.

A bi­par­tis­an group of sen­at­ors agreed on le­gis­la­tion last week that would ex­tend the gov­ern­ment’s ter­ror­ism risk in­sur­ance pro­gram for sev­en years, while rais­ing in­surer co­pay­ments from 15 to 20 per­cent.

Hult­gren says the Sen­ate bill is a good place to start, but that there are a num­ber of oth­er pro­pos­als that should be con­sidered as well.

There was hope that these dis­cus­sions would be fur­ther along at this point, but an ex­ten­sion should be passed by the sum­mer, Hult­gren said. The con­gress­man said he hopes law­makers will take up fur­ther con­sid­er­a­tions as soon as they re­turn from their April break, and have a bill to the com­mit­tee in the first few weeks of May.

“The hope is that we’ll really get this done by the sum­mer; it’s so im­port­ant to get this out of the way by Au­gust break,” Hult­gren said. “I get the sense even people who are not in total agree­ment of how it’s go­ing to work re­cog­nize that tim­ing is im­port­ant and we have to get mov­ing.”

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