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Life Health > Life Insurance

Lawmakers Sculpt TRIA Deal %28Updated%29

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Members of the U.S. House of Representatives have agreed to drop efforts to get group life insurance into an extension of the Terrorism Risk Insurance Act.[@@]

Senate Majority Leader William Frist, R-Tenn., Tuesday reversed position from late last week and said time remains for the House and Senate to negotiate an extension before Congress leaves for the year.

However, according to a representative of a policyholder group, Senate negotiators have not demonstrated a willingness to make their bill any more similar to a more expansive TRIA extension bill that the House approved last week. The House bill would have brought group life into the federal TRIA reinsurance program.

Now House negotiators have agreed to eliminate group life as a covered line in a document sent to the Senate by House negotiators in preparations for a meeting scheduled today between Rep. Michael Oxley, R-Ohio, chairman of the House Financial Services Committee, and Sen. Richard Shelby, R-Ala., chairman of the Senate Banking Committee.

The policyholder group lobbyist says House negotiators made the concessions because they believe that getting coverage for group life and acts of domestic terrorism is part of the “price to pay” to get the bill enacted this year.

The Bush administration and administration supporters in the Senate oppose inclusion of group life in TRIA, in part because they argue that the group life market has been flourishing over the past 3 years without the benefit of TRIA protection.

The House also has offered to cut a TRIA bill provision fiercely opposed by the life insurance industry that would have prohibited discrimination in life insurance underwriting based on a person’s plans for foreign travel.

The original TRIA program is set to expire Dec. 31.

Congress has been rushing to adjourn Dec. 17. Frist gave House leaders a little more leverage by saying over the weekend in another context that he might force the Senate to stay until Dec. 23, to force recalcitrant senators to accept the White House position on tax and Alaska oil drilling.

The group life industry has been struggling to regroup.

By Tuesday evening, it had won the support of at least 6 senators for a letter asking TRIA extension negotiators to “include group life insurance as a covered line in the … program.”

But a spokesman for Sen. Tim Johnson, D-S.D., one of the senators who agreed to sign the letter, made clear that none of those signing on to the letter had agreed to put a hold on the bill–effectively killing it–if group life were not included as a covered item in a final bill.

The document, prepared by the staff of the House Financial Services Committee for submission to Senate negotiators as the opening gambit in TRIA extension talks, in effect adopts the bulk of the Senate bill, which is much narrower than the bill passed by the House last week by a 371-49 vote.

The House bill is now known as S. 467.

The House is accepting Senate positions on 21 of the 25 areas in which the House and Senate TRIA bills diverge and proposing compromise language for 3 others, according to the compromise document.

One of the industry lobbyists involved in the House preparation for the meeting agreed that the House proposal to the Senate constitute surrender to the much narrower Senate bill.

“But the document has to be looked at in the context of the stubborn unwillingness of the Senate to entertain regular order in a formal conference setting to work out the differences between the 2 bills,” the lobbyist says.

“In this document, Chairman Oxley is willing to surrender much of the distinctions in the House bill in order to ensure policyholders are protected as of Jan. 1, 2006,” the lobbyist said. “This shows the magnanimous desire of Chairman Oxley to get this bill to the finish line.”


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