NU Online News Service, May 18, 2004, 6:17 p.m. EDT – A Democratic senator says the Bush administration put buildings ahead of people when it opposed placing group life insurance under the protection of the Terrorism Risk Insurance Act.[@@]
Sen. Tim Johnson, D-S.D., a member of the Senate Banking Committee, made that charge today at a committee hearing on TRIA.
Johnson said that he is very disappointed that group life insurance is not included under TRIA and that group life should be part of any extension of the federal terrorism reinsurance program.
In a time of loss, he said, a life insurance policy makes a difference for a family that otherwise might have to sell its home or have trouble putting food on the table.
One of the most obvious market shifts following the Sept. 11, 2001, terrorist attacks is the disappearance of group life reinsurance, Johnson said.
But Brian Roseboro, Under Secretary for Domestic Finance at the U.S. Treasury Department, who testified at the hearing, said that in deciding not to include group life under TRIA, Treasury was following the criteria outlined in the statute itself.
Roseboro said TRIA required Treasury to perform a 2-pronged analysis in order to determine whether to include group life as a covered risk: Treasury had to find evidence that both group life insurance and group life reinsurance were unavailable.
Group life reinsurance was unavailable when Treasury did its analysis, but primary insurance was still widely available, Roseboro said.
Roseboro added that Treasury is continuing to watch the group life market.