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Renewed efforts by conservative Republicans in the Senate to impose tort reform standards in any extension of the Terrorism Risk Insurance Act are complicating efforts to draft an extension to the legislation, which expires Dec. 31.

At the same time, the outlook for adding group life insurance to the present bill is a mixed bag. “It looks difficult for group life in the Senate because the White House is involved in the Senate talks and doesn’t want group life included,” one lobbyist said. “My prediction is that it doesn’t get into the Senate bill.”

In the House, it is a different story. The lobbyist said that “the group life people have made a persuasive case in the House. It is almost certain to get into the House bill.”

Re-emergence of the tort reform issue concerns all sides. The issue went down to the wire in November 2002 before a bill was finally agreed to, with most of the late delay caused by Republican insistence on some language curbing the ability of plaintiff’s lawyers to sue for punitive damages in cases arising out of a terrorism attack.

On the other hand, strong tort language is a bill-killer for Democrats in Congress.

Presently, vastly different bills are being negotiated on a bipartisan basis in the Senate Banking Committee and by the Republican leadership in the House Financial Services Committee. According to several industry lobbyists, the White House is participating in the Senate talks but not in the House.

There is some thought that members of the Senate Banking Committee will be presented a “take it or leave it” bill by the negotiators, with the bill going directly to the Senate floor, lobbyists said.

White House involvement in the Senate talks is complicating efforts to coordinate with the House because the White House is insisting that the restrictive principles for extension articulated in the June Treasury Department report on the issue be adhered to, according to lobbyists familiar with the substance of the talks.

The only saving grace is that the time to negotiate a bill has been extended. “Any movement in the House toward introduction of a proposal will now probably be this week,” one lobbyist said. And, while some staffers worked on a bipartisan basis last weekend in the Senate, the talks have slowed. “The Senate talks are still grinding,” one lobbyist said late last week.

“With the certain reality that Congress will be in a minimum of two weeks in December, things are now a little less frantic at the moment,” the lobbyist said.

Negotiations in the Senate involve representatives of Sens. Richard Shelby, R-Ala., and Paul Sarbanes, D-Md., chairman and ranking member, respectively, of the panel, and Sens. Robert Bennett, R-Utah, and Chris Dodd, D-Conn., authors of a bill calling for a simple two-year extension of the legislation.

Senate negotiators have agreed to Shelby’s stipulation that renewal be for a two-year period with “finality, no extension,” a lobbyist familiar with the talks said.

In the House, there is also agreement on a two-year extension with a transition to a pooling arrangement where the federal government will have far less liability than under the current TRIA bill.

Both bills will embrace the so-called “silo” concept of different levels of federal liability for different categories of insurance and for different events.

But the silos in the bills are different, one lobbyist said, declining to elaborate.

Meanwhile, interest groups continued to pelt members of Congress with letters expressing their views.

The Consumer Federation of America called on the Senate to reject calls from industry on the bill. Moreover, CFA officials said, if it is necessary to extend the program, which expires Dec. 31, it should be “dramatically scaled back.”

CFA also strongly urged Senate leaders not to relent to pressure from life insurers to cover group life losses under TRIA.

“It is time to wean insurers and large real estate interests from this lucrative government program,” said J. Robert Hunter, Director of Insurance for CFA.

“There’s not a shred of evidence that the life insurance industry needs taxpayer support in the event of future terrorist attacks,” Hunter said. “In fact, the group life market is highly competitive and insurers have many ways of spreading risk that don’t involve government largesse.”

Hunter added, “It’s shocking that the life insurance industry would try to convince Congress to actually expand this program at a time when the evidence so clearly indicates that TRIA should be eliminated or significantly scaled back.”

Senate Banking Committee Chairman Richard Shelby’s stipulation that renewal of the Terrorism Risk Insurance Act be for a two-year period with “finality, no extension,” has reportedly been agreed to by Senate negotiators.

While the House is leaning toward including group life, the Senate is seeing more resistance