Senate to Back Extension of TRIA

The post-9/11 Terrorism Risk Insurance Act (TRIA) program makes the federal government the insurer of last resort for terrorist attack damages too big for private insurers to handle.^[1] Originally passed as a stop-gap measure in 2002, it will expire on Dec. 31 unless extended; the House of Representatives voted on Sept. 19 to extend TRIA through 2017, defying a White House veto threat.^[2]

U.S. Senate panel is expected on October 17th to back extending the terrorism insurance program for seven years, shorter than an extension approved last month by the House of Representatives.^[3] The Senate Banking Committee is also expected to reject two expansions of the program endorsed by the House -- adding group life insurance coverage; and mandating nuclear, biological, chemical and radiological attack coverage.^[4]

But under a deal between senior committee members and the White House, the banking panel will follow the House's lead and vote to broaden Terrorism Risk Insurance Act (TRIA) coverage to domestic terrorism, as well as foreign.^[5]

Insurers and business interests are pushing hard for renewal, backed by Democrats and big-city Republicans.^[6] Supporters argue the private sector is showing few signs of being able to write adequate terrorism coverage and that a federal backstop is needed for economic security.^[7]

President George W. Bush threatened to veto the House's TRIA bill, saying it would make TRIA virtually permanent and that the program impedes growth of private sector insurance.^[8]

What is interesting about the TRIA is that is contains a different definition of terrorism than we are used to seeing in statutes like 18 U.S.C. § 2332. Whereas §2332 essentially criminalizes all homicide, conspiracy to commit homicide, and other physical violence with the intent to coerce public policy.^[9]

The TRIA defines the term “act of terrorism” as: any act certified by the Secretary of Treasury, in concurrence with the Secretary of State and Attorney General, to be an act that is dangerous to human life, property, or infrastructure and to have resulted in damage within the U.S. (or outside the U.S. in the case of a U.S.-flagged vessel), or on the premises of a U.S. mission.^[10] In addition, the act of terrorism must have been committed by individual(s) acting on behalf of a foreign person or foreign interest as part of an effort to coerce the U.S. population or government. Losses from the act must exceed $50 million in 2006 – up from the original $5 million trigger. In 2007, that trigger will rise to $100 million.^[11]

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^[1] Kevin Drawbaugh, UPDATE 1-US Senate panel seen backing 7-yr terror insurance, Reuters Newswire, October 15, 2007, Associated Press Newswire, July 19, 2007, LEXIS, News Library, Wire News Services File.
^[2] Id.
^[3] Id.
^[4] Id.
^[5] Id.
^[6] Id.
^[7] Id.
^[8] Id.
^[9] 18 U.S.C. § 2332(2007).
^[10] Terrorism Risk Insurance Act of 2002, Pub. L. No. 107-297, 101(a)-(b), 116 Stat. 2322, 2322-23 (2002).
^[11] Id.