Terrorism Risk Insurance Act Comment Period Open Until September 16, 2013
Jul 31, 2013
Interested parties wishing to provide input on the long-term availability and affordability of terrorism risk insurance before the Terrorism Risk Insurance Act (“TRIA”) is set to expire on December 31, 2014 have until September 16, 2013 to submit their comments to the Federal Insurance Office (“FIO”).
To view the Notice of Request for Comments in the Federal Register, click here.
The Terrorism Risk Insurance Program Reauthorization Act of 2007 (“Program”) further extended TRIA through December 31, 2014. The extension also required an ongoing analysis of the long-term availability and affordability of insurance for terrorism risk from The President’s Working Group, which most recently submitted a 2010 report updating its 2006 analysis. Another report is required by September 30, 2013-hence the FIO’s request urging early submission of comments, which it directs should specifically relate to the time period since 2010.
The President’s Working Group analysis will be done in consultation with the National Association of Insurance Commissioners, representatives of the insurance industry, representatives of the securities industry and representatives of insurance policyholders. The FIO-part of the U.S. Treasury-seeks comment from these and any other interested parties to assist the President’s Working Group in drafting the forthcoming report.
Generally, comments should identify and explain any and all factors relating to the availability and affordability of terrorism insurance, particularly how these factors have affected the availability and affordability of terrorism insurance since 2010.
To go directly to the online comment form, click here.
Specifically, the FIO seeks responses to the following:
TRIA Program Termination Considerations
(1) Describe and explain in detail any and all possible ramifications from the termination of the Program on December 31, 2014, including any available evidence to support the predicted result, regarding:
(a) The availability and affordability of insurance for terrorism risk in the United States generally;
(b) The availability and affordability of insurance for terrorism risk in the United States specifically by line of business; geographic location, including the rating tiers defined by the Insurance Services Office, Inc.; and other relevant characteristics; and
(c) Additional specific effects on commerce in the United States.
(2) If the Program were to continue beyond December 31, 2014, describe and explain in detail any revisions or modifications to the Program that would promote the availability and affordability of terrorism insurance, including any accompanying challenges that might arise from any proposed revisions or modifications to the Program. All views regarding the appropriate role of the federal government in supporting the availability and affordability of insurance for terrorism risk are welcome.
Insurance Market Considerations
(3) Describe and explain the ability of the insurance industry to model, quantify, and underwrite terrorism risk, and the resulting impact of such analysis on the availability and affordability of terrorism insurance, including an examination of the price (by line of business, location of risk, and other relevant characteristics) and coverage options for terrorism insurance.
(4) Describe and explain, with supporting information where available, any additional insurance market considerations that could impact the long-term availability and affordability of terrorism insurance (e.g. implications for coverage of insurance for nuclear, biological, chemical, and radiological acts of terrorism; cyber acts of terrorism; and terrorism in workers’ compensation policies).
(5) Explain and describe in general the demand (or “take-up”) of terrorism insurance and provide specific data and information, where available, regarding the take-up rate by line of business, location of the risk, and other relevant characteristics.
(6) Describe and explain in detail the long-term availability and affordability of private reinsurance for terrorism risk. Analyze, with supporting information, the impact of the Program, and any changes to the Program, on the private reinsurance market for terrorism risk, including any accompanying challenges that might arise from revisions or modifications to the Program.
(8) Describe and explain any other developments, considerations, or market issues that might affect the long-term availability and affordability of terrorism risk insurance.
Comments submitted will be posted on the following Web page: http://www.regulations.gov/#!documentDetail;D=TREAS-DO-2013-0003-0001
Should you have any questions or comments, please contact Colodny Fass& Webb.
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