The Senate is about to respond to the introduction of a Terrorism Risk Insurance Act extension bill in the House with a narrower extension bill of its own that probably will exclude protection for group life insurers.[@@]
The Senate Banking, Housing, and Urban Affairs Committee expects to meet at 10:30 a.m. Wednesday to consider a new version of S.467, a TRIA extension bill that originally was introduced in February, according to the Senate committee hearing schedule.
The House Financial Services Committee expects to mark up a House TRIA extension bill, H.R. 4314, during a meeting that will start at 10 a.m. Wednesday, according to the House committee schedule.
Most observers expect the White House, which has emphasized its preference for a narrow extension bill, to endorse the Senate bill.
The Senate bill was negotiated by Sens. Richard Shelby, R-Ala., chairman of the Senate Banking Committee, and Chris Dodd, D-Conn., a senior member of the committee.
The Senate bill will call for a $50 million trigger for federal support in the first year, and a $100 million trigger in the second year.
H.R. 4314, a bill introduced Monday night by Rep. Richard Baker, R-La., chairman of the Capital Markets Subcommittee of the House Financial Services Committee, contains the same triggers.
But the new version of S. 467 will call for insurers to put more “skin in the game,” according to several industry and congressional officials.
The Senate bill will call for a 17.5% retention level for insurers across all lines of business in the first year, and 20% in the second year. But the bill will include no coverage for general liability, according to industry lobbyists.
The House bill calls for different retention levels for industry based on lines of business.
The retention level for group life, for example, would be 20% in the first year and 22.5% in the second year, but the retention level for nuclear, biological, chemical and radiation risks would be just 7.5% in the first year and 8.25% the second year.
The Senate bill would require that the TRIA program end in 2007.
The House bill would allow for the possibility of extending TRIA protection into 2008.
The House Financial Services Committee could vote on some version of the Baker bill as early as Wednesday.
Over in the Senate, the Dodd-Shelby TRIA extension bill could ride to the floor this week as an amendment attached to another pending bill, lobbyists say.
Lobbyists say the Senate and House could hammer out a TRIA extension compromise bill over the Thanksgiving break.