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Life Health > Life Insurance

Industry Pans House TRIA Bill Travel Discrimination Provision

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Members of the U.S. House voted 371-49 Wednesday to pass a Terrorism Risk Insurance Act bill that includes group life insurance but also includes a provision that would restrict life insurance underwriting.[@@]

The House and Senate now must hold a conference to reconcile their TRIA extension bills.

The House bill, a version of S. 467, includes coverage for group life insurance, but it also includes a provision which would prohibit discrimination in life insurance policies based on a person’s plans for foreign travel.

The Bush administration says it opposes adding group life to the TRIA program because group life does not need TRIA protection.

The American Council of Life Insurers, Washington, says it will have difficulty supporting the bill because of the inclusion of the travel insurance amendment.

A representative of the Group Life Coalition, Washington, a group formed to get group life added to TRIA, says the coalition will support the bill.

“The overwhelming, bipartisan inclusion of group life in the House version of this critical legislation will hopefully serve as reminder and wake up call that the House of Representatives will not prioritize the financial security of buildings over people,” says Phil Anderson, the coalition’s executive director.

Rep. Barney Frank, D-Mass., ranking minority member of the House Financial Services Committee, called the travel insurance provision “an important consumer protection provision.”

The Senate bill contains neither provision.

The provision, authored by Rep. Debbie Wasserman Schultz, D-Fla., and accepted by voice vote by the House Financial Services Committee, would prohibit the denial of life insurance, or the charging of premiums that are not based on sound actuarial principles or on a good faith actuarial analysis, solely because a person plans to engage in lawful travel outside the United States.

The provision would permit insurers to price for risk, but it would prohibit them from simply denying consumers life insurance based solely upon possible travel, according to Frank.

ACLI President Frank Keating says the life insurance industry is “deeply disappointed” about the travel amendment language.”

“The life insurance industry is prepared to support the TRIA reauthorization bill if it does not include this attack on fundamental concepts of risk assessment,” Keating says.


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