Members of the House voted 312-110 today to pass H.R. 2761, the Terrorism Risk Insurance Revision and Extension Act of 2007.
The bill, introduced by Rep. Barney Frank, chairman of the House Financial Services Committee, would extend and expand the current federal terrorism insurance program.
One provision in the House bill would add protection for group life insurers.
Some senators have objected to provisions in the House bill that would expand the terrorism insurance program, and Bush administration officials have indicated that President Bush likely would veto H.R. 2761 if the current version of the bill came across his desk.
Although H.R. 2761 passed by a wide margin, earlier procedural votes were closer.
A motion to send the bill back to the House Financial Services Committee failed 196-228.
A vote on raising the deductible that insurers must pay 1% per year, instead of 0.5% per year, failed 196-228.
The “no” votes came mostly from Republicans.
The law authorizing the current terrorism insurance program will expire Dec. 31.
The American Council of Life Insurers, Washington, has welcomed inclusion of group life in the new terrorism program bill, but it has expressed concerns about a revised version of a travel underwriting provision. The provision would limit insurers’ ability to reject applicants or increase rates based on applicants’ travel plans.
“The changes provide for a more restrictive standard for declining coverage in connection with foreign travel,” says Jack Dolan, an ACLI staff official.
“The effect will be that it would require a good faith determination by an insurer of fraud in a particular country for insurers to deny coverage,” Dolan says.
The word “fraudulent” replaces “unlawful” in the text,” Dolan says. “Also, the second change–insertion of the word ‘substantially’–means that the credibility information by which the insurer can verify the death of the insured will have to be substantially compromised before we can deny coverage.” Dolan says.
“We are unhappy that these changes were made,” Dolan says. “They reopened an issue that had been agreed upon and closed. But we are not going to oppose this. We want TRIA legislation with group life’s inclusion reauthorized.”