Democrats in the House will include group life insurance in any legislation enacted to extend the Terrorism Risk Insurance Act, said Rep. Barney Frank, D-Mass., the incoming chairman of the House Financial Services Committee. His comments constitute a reversal of current policy, where Republicans, and especially the White House, have repeatedly declined to include group life in the program, which began in November 2002, and have repeatedly said that when it expires Dec. 31, 2007, it would not be renewed.
Frank made his comments on Dec. 6 at a press availability convened to discuss some of his priorities for the House Financial Services Committee next year.
“We will expand it,” Frank said in response to a question from National Underwriter. “We want to cover workers’ compensation, as well as group life insurance,” he added.
“Not covering group life insurance is like making TRIA into the latest version of the neutron bomb,” he said. “You know what the neutron bomb does? It kills people and leaves the property standing.”
Industry reaction was positive. “We’re encouraged,” said Jack Dolan, a spokesman for the American Council of Life Insurers. “There is a role for the federal government to play in helping ensure coverage is available as the reinsurance market develops to cover terrorism risks.”
Frank’s statements on TRIA expand on those he made Nov. 30 before the Consumer Federation of America, asserting that the Democrats will move early enough in the year on TRIA to provide certainty it will be extended.
He added to that by saying that under the Democrats, TRIA could be extended for as long as 5 years, and it will specifically include workers’ compensation and nuclear, chemical, biological and radiation risks.
Republicans had narrowed the bill in the last Congress, and the administration has made clear it does not want TRIA extended.
At the same time, industry officials privately cautioned that the House has consistently been more expansive about its support for TRIA than the Senate.
But Sen. Chris Dodd, D-Conn., who has generally been supportive of the industry and who played a key role in enactment of the original TRIA in 2002, will be taking over as chairman of the Senate Banking Committee next year.
At a press event on Dec. 7, Dodd said he wants to make TRIA permanent. “I will not do another extension,” he said. “It’s going to be a permanent bill or nothing.”