He noted, "After years of the most comprehensive work done globally on terrorism financing mechanisms, the OECD concluded, in a manner consistent with what we have been saying in the U.S., that terrorism is a very different type of risk that is largely uninsurable and that public-private partnerships are essential for a terrorist compensation system."

The report confirms that "there is no real alternative to a government-insurers partnership," Mr. Snyder said. He went on to say that "there are no alternative financing markets on the horizon that are capable of picking up this risk."

Mr. Snyder called the report "important," reflecting "as it does the views of the most highly developed democracies around the world."

David Winston, senior vice president of federal affairs at the National Association of Mutual Insurance Companies, said "it is interesting that the OECD is voicing at this moment many of the concerns that NAMIC has raised. This is a very timely development as Congress will soon be examining whether or not to extend the TRIA federal reinsurance backstop that is scheduled to expire at the end of this year."

"All of the OECD countries have already come to the conclusion that there must be a public-private partnership," Mr. Winston added, "and have rejected the idea that the private market can handle this alone."

Mr. Winston said it is "also important to underscore that the OECD countries are not concerned about government participation crowding out the private market. Hopefully, the United States and the OECD countries will benefit from each other in developing a solution."

The OECD report concludes that:

o Years after the 9/11 events, terrorism remains a major challenge for the insurance world because it is highly, and increasingly, unpredictable. It is still more difficult to cover than other catastrophic risks.

o Terrorism risk modeling, though it has improved, falls short of making the likelihood of future attacks more predictable. Also, it is very subjective and less reliable than the modeling of other large risks.

o Financial markets may in the future provide additional capacity, but they have so far shown little appetite for terrorism risk and are not expected to increase market capacity substantially in the short term.

o OECD member countries should rely, as far as possible, on private sector solutions to cover terrorism risks. However, government intervention may be needed to increase, or maintain, terrorism insurance availability at an affordable price, where private markets lack capacity.