Members of the House and Senate delivered voice votes over the weekend approving a bill that could extend the Terrorism Risk Insurance Act for 2 years.[@@]
The bill, which is similar to a narrow version of the bill passed by the Senate, excludes coverage for group life from the TRIA program but also excludes a provision that would have prohibited life insurers from denying life applications based on individuals’ plans for foreign travel.
The American Council of Life Insurers, Washington, supported the group life provision but opposed the foreign travel provision.
House and Senate leaders came up with the compromise version of the bill that passed Friday.
The original TRIA program, which is set to expire Dec. 31, excludes protection for group life insurers.
Sen. Richard Shelby, R-Ala., chairman of the Senate Banking Committee, and the White House, supported the narrow TRIA extension bill, but the White House did not immediately say whether President Bush would sign the version passed by Congress.
“Chairman Richard Shelby of the Senate Banking Committee forged the basic agreement weeks ago with TRIA supporters Sens. Chris Dodd, D-Conn., and Robert Bennett, R-Utah,” the Council of Insurance Agents and Brokers says in a bulletin to members issued Friday. “Sen. Shelby had opposed the passage of TRIA in 2002, and clearly wanted to scale back the scope of the program with an ultimate goal of finality in the federal component of the backstop.”
But Rep. Michael Oxley, R-Ohio, chairman of the House Financial Services Committee has issued a statement calling the final version of the TRIA extension bill “shortsighted.”
“When members, inevitably, are asked again to renew this ‘temporary’ program, they will correctly conclude that in 2005 the can was simply kicked down the road without any real reform,” Oxley says in the statement.
In addition to keeping group life out of the TRIA program, the final extension bill would eliminate protection previously provided for general liability, commercial auto, burglary-theft, surety, professional liability and farm owners’ multiple peril insurance.
The compromise version of the TRIA bill also would raise the program trigger from the current level of $5 million in insured losses to $50 million in insured losses in 2006 and $100 million in 2007.
A “President’s Working Group” will be appointed to review how the program works and make further recommendations.