One of things the insurance industry hates most is uncertainty.The ability to accurately assess and predict risk with reasonablecertainty is key to success in the insurance business.

Imagine the shock whenever attempts are made to predict whatCongress will do. Congress often seems to specialize in creatinguncertainty, especially regarding insurance issues.

Most observers would have predicted that the Terrorism RiskInsurance Act (TRIA) would be renewed without difficulty longbefore its Dec. 31 expiration.

Soon after this column is published, the elections will be overand Congress will be back in a “lame-duck” session, to hopefully dolate what they already should have accomplished months ago:reauthorizing TRIA.

On July 17, the U.S. Senate passed a bill to renew TRIA by anoverwhelming, bipartisan vote of 93-4. The House Financial ServicesCommittee had also passed its own bill to reauthorize the program,but unfortunately it was on a partisan vote, and despite the effortfrom Republican leadership, lacked the votes to pass out of thefull House. While most believe the House would pass the Senate'sversion of TRIA, Rep. Jeb Hensarling (R-Texas), chairman of theHouse Financial Services Committee, refused to give up on hispreferred reauthorization bill. This impasse derailed furtheraction until after the November elections.

Hensarling, perhaps betting on a GOP takeover in the Senate,continued to push his own TRIA reauthorization bill, H.R. 4871, theTRIA Reform Act of 2014, which gradually raises the program triggerand provides a federal backstop only for chemical, biological,radiological, and nuclear (CBRN) events after five years. The billwould end TRIA as we know it.

Injecting this kind of uncertainty into something as importantas the continued availability of terrorism coverage plays havocwith our nation's economy. Middle-market commercial policyholderscould face an availability crisis if the federal backstop iseffectively gutted, as some have proposed. This is not solely aconcern of marquee properties in large East Coast cities; terrorismcover is essential for businesses across the U.S., from shoppingcenters in the Midwest to oil rigs in the Gulf of Mexico.

This is an inopportune time for cutbacks on the federalterrorism insurance backstop, which costs the government nomoney.

In September, President Barack Obama declared the Islamic Stateof Iraq and Syria (ISIS) a “severe threat” to the U.S. and orderedairstrikes on ISIS targets in Syria. The fear that ISIS couldinitiate attacks against the U.S. prompted the InsuranceInformation Institute (III) to issue a report calling for a quickrenewal of TRIA.

III's rationale makes sense. If the risk of terrorism isincreasing, shouldn't we be increasing—not decreasing—preparationsto deal with that threat?

The cause of congressional unpredictability is a basicdifference of opinion about the proper role of government. Somelegislators say the federal government has a legitimate role inassisting the business community, especially in matters ofprotecting the public. Other legislators believe just aspassionately that the role of government in business should begreatly reduced, no matter what the intention.

Until this basic philosophical difference moves closer to beingresolved—or until the advocates of one approach or the other gain aclear, sustained political advantage—there will be moreuncertainty.

Looking at the dysfunction in Washington, we can take comfort inthe fact that insurance is regulated by the states. The idea thatdisagreements about issues affecting insurance will be settled oncethe elections are over contradicts recent history. One electionwill not heal the partisan divide causing all the gridlock. Notmuch will be resolved by this one election cycle. It will just leadto the next cycle, which has already started.