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US Senate passes seven-year TRIA extension

The US Senate passed a seven-year extension to the Terrorism Risk Insurance Act (TRIA) last Friday (16 November).

The bill passed would also seek to broaden the range of coverage to take in potential domestic, as well as foreign terrorist attacks.

However, it differs significantly from the 15-year extension passed by the House of Representatives earlier this year setting up a struggle between the two branches of the legislative.

President Bush has already said he will veto the Representatives bill, which would extend the programme for 15 years; mandate private coverage for nuclear, chemical, biological and radiological attacks; take in group life insurance; and set a lower TRIA damages trigger, if it reaches him un-amended.

“It is very important that we begin conversations about a compromise,” said Barney Frank, chairman of the House Committee on Financial Services. “I look forward to a formal conference or otherwise with the Senate.”

The Massachusetts Democrat said previously that he might seek a short-term TRIA extension, of possibly four months, rather than accept the Senate bill under deadline pressure.

“This programme was created in 2002 because after 9/11, the private insurance market vanished for property owners and developers who wanted to insure against the risk of terrorist attacks,” said Senate majority leader Harry Reid. “Without this program, terrorism insurance will become unavailable or prohibitively expensive, construction projects would grind to a halt and Americans would lose jobs."

David Sampson, president of the Property Casualty Insurers Association of America praised the Senate vote and called TRIA a “vital terrorism risk program ... to insure an otherwise uninsurable risk”. 

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