The Bush administration threatened Monday to veto a House Terrorism Risk Insurance Act extension bill, in part because the bill includes protection for group life insurers and protection against domestic terrorism.

“The insurance market for these risks has remained robust and competitive since TRIA’s inception, even absent a federal backstop,” officials at the White House Office of Management and Budget write in a statement of administration policy sent to the House Rules Committee.

“Adding these insurance coverages to the federal reinsurance backstop sends the wrong signal to the marketplace, which instead should be encouraged to find new ways to diversify the risks of doing business,” officials write.

The TRIA extension bill, H.R. 2761, the Terrorism Risk Insurance Revision and Extension Act, is supposed to go to the House floor Tuesday. At press time, the Rules Committee was establishing the rules for debating the TRIREA bill.

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

H.R. 2761 would extend the program for 15 years and add a number of features, such as provisions relating to attacks made with nuclear, biological, chemical or radiological weapons, in addition to group life protection.

In the past, Bush administration officials have argued that TRIA was supposed to be a temporary effort to help insurers cope with the Sept. 11, 2001, terrorist attacks. The program ought to sunset Dec. 31, officials have said.

The White House now has backed away from its earlier insistence that the program sunset Dec. 31.

But the administration still opposes the idea of extending TRIA for 15 years, OMB officials write in the new policy statement

“Instead, the program should be phased out in the near future,” officials write.

The American Council of Life Insurers, Washington, continues to support adding group life to TRIA, says ACLI staffer Whit Cornman.

“While we certainly agree that there needs to be adequate terrorism insurance coverage for buildings, we also believe that the people who work or reside inside those buildings should be adequately covered for such events as well,” Cornman says.