The Consumer Federation of America called on the Senate toreject calls from the insurance and real estate industries to renewthe Terrorism Risk Insurance Act.

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Moreover, CFA officials said today, if it is necessary to extendthe program, which expires Dec. 31, it should be "dramaticallyscaled back."

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CFA also strongly urged Senate leaders not to relent to pressurefrom life insurers to cover group life losses under TRIA.

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CFA officials sent their letters to members of Congress assenators, congressmen and staff officials continued to draft plansto extend the program before they adjourned for the year–somethingindustry lobbyists believe is unlikely to happen beforemid-December at the earliest.

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"It is time to wean insurers and large real estate interestsfrom this lucrative government program," said J. Robert Hunter,CFA's director of insurance and former Texas insurance commissionerand federal insurance administrator.

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"It's impossible to justify terrorism insurance subsidies wheninsurance profits are skyrocketing, commercial insurance rates aresinking, and beleaguered taxpayers still face growing budgetdeficits," he said.

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Mr. Hunter added that "had actuarially-based premiums beencharged to insurers for the insurance coverage that taxpayers haveprovided, the Treasury Department would have amassed about $3billion by now."

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Travis B. Plunkett, CFA's legislative director, added that "bydramatically scaling back TRIA to cover only the most significantterrorism losses, the Senate would be spurring the private marketto continue expanding its ability to offer terrorism coveragewithout taxpayer assistance."

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He said that "this, in turn, would encourage businesses andothers that buy terror coverage to do everything they can toprevent terrorism losses."

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Regarding group life, "there's not a shred of evidence that thelife insurance industry needs taxpayer support in the event offuture terrorist attacks," Mr. Hunter said.

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"In fact," he continued, "the group life market is highlycompetitive and insurers have many ways of spreading risk thatdon't involve government largesse."

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Mr. Hunter called it "shocking that the life insurance industrywould try to convince Congress to actually expand this program at atime when the evidence so clearly indicates that TRIA should beeliminated or significantly scaled back."

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