Washington–Joseph Plumeri, chairman and chief executive officerof the Willis Group insurance brokerage, has urged President Bushto develop a long-term solution for the terrorism problem hisindustry faces.

Mr. Plumeri's letter is a first salvo in what is expected to bea concentrated industry effort this month to ensure that apresidential panel studying the terrorism insurance market has alot of industry input in drafting its report.

The American Insurance Association in a new brochure to memberslisting its advocacy priorities for 2006 said it “will continueworking with the policyholder community and government officials toadvance workable, long-term solutions for terrorism risk that canextend beyond the end of 2007, when the program expires.”

Mr. Plumeri, in a recent letter to President Bush, said thepresidential advisory panel created by the recently-extendedTerrorism Risk Insurance Act should be the vehicle for a permanentfix.

The group, he said, should “…look beyond the limited chargegiven to it by Congress and seek to develop practical, long-termsolutions to what is likely to be a more or less permanentproblem–terrorism.”

The recent two-year extension of TRIA, which provides a federalbackstop for insurers when terrorism losses reach certain thresholdlevels, is no more than a “place-holder on the path of a long-termsolution,” Mr. Plumeri wrote.

Mr. Plumeri added, “Many other countries have developed varyingpublic/private approaches to address this problem, and we now havetwo years to find a more permanent solution.”

Under the new TRIA law, signed by President Bush Dec. 22, thepresident's Working Group on Financial Markets is required toconsult with the NAIC, representatives of the insurance andsecurities industries, and representatives of policyholders toanalyze the long-term availability and affordability of insurancefor terrorism risk.

Their charter includes an examination of the situation for grouplife coverage and coverage for chemical, nuclear, biological andradiological events. The working group must report back to Congressby Sept. 30.

The panel has been in existence for a while, according toTreasury officials. It is comprised of representatives of theTreasury Department, the SEC, Commodity Futures Trading Commissionand the Board of Governors of the Federal Reserve Board.