Claims News Service, Oct. 4, 10:56 a.m. EDT — In a new report, GE Insurance Solutions examines the debate over extension of The Terrorism Risk Insurance Act (TRIA) and its effect on the workers' compensation system.

In the paper titled “TRIA Sunset and Its Impact on Workers' Compensation,” Bill Carney, workers' compensation product leader, writes on the possible sunset of TRIA and the consequences for the workers' compensation delivery system should a chemical, biological, nuclear or radiological (CBNR) attack or similar catastrophic terrorist event occur.

“If TRIA is allowed to expire at the end of the year, workers' comp insurers and self-insured employers cannot exclude terrorism coverage, unlike property insurers,” says Carney. “Consequently, there's a great deal at stake here, not the least of which is the future of the system which was designed to protect America's workers.”

The article suggests that in the absence of a public-private partnership such as TRIA, the workers' comp market may shrink in major metropolitan areas due to a shortage of market capacity, reinsurance availability, and pressures from rating agencies.

“The role of insurance is to help foster a sound economy,” says Carney. “That's why insurers are advocating the extension of TRIA — so that they can withstand the financial impact of future terrorist attacks and continue to provide people and businesses with the support they need.”

Carney also addresses the challenges businesses face in mitigating their terrorism exposures, particularly with respect to workers' compensation. In addition, he discusses the emergence of alternative risk transfer mechanisms, the efficacy of state guaranty funds, and the impact of the TRIA debate on self-insurance.

More information about the International Association of Industrial Accident Boards and Commissions Journal can be found at www.iaiabc.org/publications/journal.htm, www.geinsurancesolutions.com.

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GE Insurance Solutions Examines TRIA Consequences

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