Treasury Seeks Information On Group Life Market For Terrorism Re Program
The Treasury Department is seeking detailed information on the marketplace for group life insurance for its determination on whether group life should be included in the recently enacted federal terrorism reinsurance program.
Treasury Under Secretary Peter R. Fisher notes that the terrorism insurance legislation requires Treasury to prepare, on an expedited basis, a study on the impact of terrorism risk on group life insurers and on the availability of group life coverage.
Toward that end, he says, Treasury is seeking public comments on the issue.
The request for comments, which Fisher says will be published shortly in the Federal Register, seeks input on who are the buyers and sellers of group life insurance and how they are brought together.
The request asks how the group life market is regulated in the U.S. and whether there are significant differences among the states.
It also seeks input on risk exposures of policyholders, including the degree of concentration both by locality and type of employer.
In addition, the request asks for details on the availability and price of group life reinsurance both before the Sept. 11 terrorist attack and after. Treasury is asking for specifics on the type and amount of coverage available, deductibles, sublimits and renewability.
Treasury is also seeking input on current capacity and the availability of alternate sources of reinsurance, such as through capital markets.
In particular, Treasury wants empirical support for whether group life insurers have reasonable access to adequate and affordable catastrophe reinsurance, and if not, why inclusion in the program would correct the situation.
Respondents, Treasury adds, should compare the magnitude and scope of the group life situation to that which confronted property-casualty insurers.
Finally, Treasury says, if it is appropriate to include group life under the program, the presumption is that the current provisions of the legislation would apply.
But if these provisions are not applicable, Treasury says, respondents should provide a detailed explanation of the changes that would be needed to implement the program for group life.
Comments are due to Treasury 30 days after the request is published in the Federal Register.