Eleven years ago, 9/11 served as the catalyst for the creation of standalone terrorism insurance market in the U.S., now estimated at over $2 billion per risk. In recognizing the anniversary of the tragic events, the Subcommittee of Insurance, Housing and Community Opportunity of the U.S. House of Representatives will meet today to hear testimony from a broad panel of industry witnesses as to the effectiveness and continuation of the Terrorism Risk Insurance Act of 2002.
The panel will be examining the conditions within the current insurance market, both from an insurance and reinsurance perspective, and will consider new options for future cooperation between the public and private sector. In particular, at issue is whether or not the Terrorism Risk Insurance Act of 2002 (TRIA) has provided adequate terrorism insurance capacity over the past decade.
TRIA acts as a form of federal reinsurance designed to act as a backstop for private insurance companies that offer terrorism insurance. TRIA was created as a result of the vacuum after 9/11, when the global insurance marketplace subsequently excluded coverage for acts of terrorism from property and casualty programs. Organizations such as the Coalition to Insure Against Terrorism (CIAT) will speak to members of Congress as to TRIA’s perceived success in providing insurance consumers with sufficient terrorism insurance.
The meeting highlights a significant effort and commitment by both public and private sectors to find a long-term solution for terrorism insurance in the United States. While the potential expiration of the federal reinsurance program is two years away, the government and private markets are taking a proactive approach by agreeing to meet this far in advance. There will undoubtedly be implications that arise from the meeting, and I will keep you all posted as soon we hear feedback from Washington D.C.
- Robert P. Hartwig, President, Insurance Information Institute
- David C. John, Senior Research Fellow, The Heritage Foundation
- Rolf Lundberg, Senior Vice President, Congressional and Public Affairs, U.S. Chamber of Commerce, on behalf of the Coalition to Insure Against Terrorism
- Erwann Michel-Kerjan, Professor and Managing Director, Risk Management and Decision Processes Center, Wharton School of Business, University of Pennsylvania
- Janice Ochenkowski, Managing Director, Jones Lang LaSalle, on behalf of the Risk and Insurance Management Society, Inc.
- Linda St. Peter, Operations Manager, Prudential Connecticut Realty, on behalf of the National Association of Realtors
- Steve Bartlett, President and Chief Executive Officer, The Financial Services Roundtable
- Darwin Copeman, President and Chief Executive Officer, Jewelers Mutual Insurance Company, on behalf of the National Association of Mutual Insurance Companies
- Jon A. Jensen, President, Correll Insurance Group, on behalf of the Independent Insurance Agents & Brokers of America
- Michael H. Lanza, Executive Vice President and General Counsel, Selective Insurance Group, Inc., on behalf of the Property Casualty Insurers Association of America
- Christopher M. Lewis, Senior Vice President and Chief Insurance Risk Officer, The Hartford, on behalf of the American Insurance Association
- Edward B. Ryan, Senior Managing Director Aon Benfield, Aon plc, on behalf of the Reinsurance Association of America