Filed Under:Agent Broker, Coverage Issues

Why TRIA failed in the Senate

A year-long effort on the part of a broad coalition of American businesses to secure a long-term renewal of the Terrorism Risk Insurance Act (TRIA) came to an end at 10:44 p.m. Eastern Time on Dec. 16, 2014. That’s when the U.S. Senate adjourned for the year without acting on TRIA.

Reauthorization of TRIA should never have been in doubt. Days before, the U.S. House of Representatives approved a bipartisan bill extending the terrorism insurance program for six years on a vote of 417-7. The Senate had passed a similar bill by an equally lopsided margin in July, 93-4. Leadership of both parties in both chambers strongly backed renewal and worked to get a compromise deal done.

The National Association of Professional Insurance Agents (PIA) is shocked and dismayed that Congress would adjourn without doing its job by passing a long-term renewal of TRIA, especially at a time of increasing terrorist threats.

“Disagreement won the day and politics took precedence over protecting the American people,” said PIA National Executive Vice President & CEO Mike Becker. “If TRIA is allowed to lapse it will not only be devastating to the American economy, it will also put our national security at risk. PIA calls on Congress to come back as soon as possible and finish its work by extending TRIA, so the American people will not be unprotected. Holiday activities can wait.”

Other coalition members expressed similar sentiments.

How Did It Happen?
So, how did legislation that enjoyed nearly unanimous, bipartisan support end up going down in flames?

A big part of the reason is the way the Senate works. Under the rules, any one senator can object to any piece of legislation coming to the floor for debate and a vote. This is referred to as placing a “hold” on a bill. A series of time-consuming procedural steps are needed to break such a hold.

Oklahoma Republican Sen. Tom Coburn placed a hold on S. 2244, the TRIA renewal bill which was passed by the House. He objected to a provision in the bill creating the National Association of Registered Agents and Brokers (NARAB II), a national insurance agents’ licensing group designed to facilitate multi-state licensing. PIA supports NARAB II.

Sen. Coburn opposed S. 2244 because he said states’ rights could be violated by the creation of NARAB II. In the final days of the Senate’s session, he attempted to insert an amendment which would sunset NARAB II in two years; he also asked for a provision allowing states to opt out. But amending the House-passed bill would have required the altered version to be voted on again by the House, and the House had already adjourned for the year in the previous week.

Sen. Coburn: “I Don’t Care”
Press reports say Sen. Coburn told negotiators at the end that he also believed that TRIA was a giveaway by federal taxpayers to the insurance industry. Or, as he remarked just days before, “Quite frankly, I don’t care whether TRIA happens or not. I have leverage now. If they want to pass it, put the [NARAB II] opt-out in and let’s go to town.”

The Senate could have stayed in session and done the procedural work necessary to get past the hold Coburn placed on the TRIA renewal bill, but that would have taken several days.

Most Americans who work for a living may get a day or two off for Christmas and New Year’s. Some people must work on those holidays. In contrast, Congress takes a lot of time off, despite the fact that members like to describe that time as “District work days.”

Ultimately, the public will get to decide whether not wanting to work until December 19 or 20 before taking off for the holidays was a valid reason to allow the nation’s terrorism insurance program to expire. 

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