The Treasury Department is about to publish new Terrorism Risk Insurance Program regulations in the Federal Register.
The program protects insurers against big terrorist attacks.
I’m not really sure whether the government should have a special program to protect insurers specifically against terrorism, as opposed to earthquakes, hurricanes and other disasters. Maybe a disaster is a disaster.
Regardless, one of the provisions in Terrorism Risk Insurance Act that has always annoyed me is still there, and is noted in the new regulations: The terrorism program specifically excludes coverage for group life insurance and group health insurance.
Of course, in the real world, the reason act contains that exclusion is that a disaster has to kill many tens of thousands of people before it will have much of an effect on typical U.S. life insurers. Life insurers are solid companies, and they already pay millions of claims per year.
If a terrorist incident really killed tens of thousands of Americans, Congress would probably step up and help the victims.
But it’s awful to look in the law and regulations and see that the documents don’t even hint about that.