Hunter Opposes Group Life In TRIA
New York Sen. Charles Schumer opened a hearing on the Terrorism Risk Insurance Act last week by calling on Congress to “act now” to renew the reinsurance program. “We should do it, lets do it nowlets do it permanently.”
But Robert Hunter, director for the Consumer Federation of America, said he opposed renewal and also rejected calls for extending the program to group life insurance.
Hunter referred to TRIA “as free reinsurance,” where the cost is put on taxpayers. He added, “I dont think the taxpayers should have to shoulder that.”
Regarding group life insurance, Hunter added, “The Treasury Department wisely decided not. I think you should ask them why, and I think I know why. Its not necessary.”
By contrast, Howard Mills, acting New York insurance superintendent, said, “We do support the inclusion of group life,” noting such factors as the concentration of workers in New York City. Mills also testified on behalf of the National Association of Insurance Commissioners at the hearing, but he cautioned that his view as New York superintendent is different from that of the NAIC.
Mills said the NAIC has “a different opinion” on the issue, then said later that NAIC has not taken an official position on the group life issue, although Hunter had earlier said the NAIC had concluded “it wasnt necessary.”
The law expires at the end of the year, and the Senate Banking Committee hearing deals with the programs effectiveness since it was enacted in November 2002. A bill introduced several months ago by Sens. Robert Bennett, R-Utah, and Chris Dodd, D-Conn., S. 467, and co-sponsored by a host of the members, would extend the program for two years while a permanent solution to the issue of who should pay for damages caused by terrorist attacks is debated.
During the question-and-answer segment, Dodd said, “If there were a private sector solution to this problem, we wouldnt be here.” He noted that some members and industry officials had suggested full government coverage, while he had suggested a full private market. “We need a hybrid, to get this right,” he said.
Renewal talks are on hold because the Treasury Department is mandated under the existing law to send a report to Congress on the programs effectiveness by June 30.
Reproduced from National Underwriter Edition, April 15, 2005. Copyright 2005 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.