On Monday, January 12th, President Obama signed the Terrorism Risk Insurance Act. This law, which will last for six years, ends the recent confusion regarding the renewal of the federal insurance backstop for businesses and terrorism coverage.
Background:
The attacks of September 11, 2001 resulted in a widespread withdrawal of coverage for terrorism-related losses from the insurance marketplace. In response, Congress adopted the Terrorism Risk Insurance Act of 2002 (TRIA), requiring insurers to make terrorism coverage available with their property and casualty products. Insureds have had the option of accepting or rejecting terrorism coverage subject to an additional premium. In December of 2007, the TRIA program was extended through the end of 2014. However, Congress did not renew TRIA prior to the end of its most recent term. On January 7th, the Congress passed a provision reinstating the act. The following day, on January 8th, the Senate passed the Terrorism Risk Insurance Program Reauthorization Act of 2015. President Obama signed the bill into law on January 12, 2015.
We will continue to communicate developments regarding this situation and provide any details as they become available.
Please contact your SterlingRisk Account Executive with any questions.
