The head of the Insurance Information Institute says in the wakeof the bombing tragedy at the Boston Marathon that the stability ofthe terrorism risk insurance market is contingent onsustaining a federal terrorism risk insurance backstop.

In most cases, out of concern the current focus should beon the people and communities impacted by the attack, industryofficials are being cautious about commenting about theimpact the bombing in Boston could have on its pushfor reauthorization of the Terrorism Risk Insurance Act(TRIA)–one of the industry's top priorities this year.

Robert Hartwig, president of I.I.I., whowas standing about 100 feet from one of the bomb sites watchinghis son finish the marathon (he luckily left more than a hourbefore the blast), says the first successful terror attack inthe U.S. since 9/11 and TRIA's scheduled expiration at the end of2014 will prompt federal lawmakers to assess whether terrorism risknow, or ever, will be a risk that can be managed entirely withinthe private sector.

“The evidence, both in the United States and from similarprograms abroad, is that market stability in terms of both pricingand availability of terrorism coverage, as well as the ability tomaintain adequate and expanding levels of capacity over time, arecontingent on the continued existence of a federal terrorism riskinsurance program,” Hartwig says.

The insurance industry is pushing to have legislation creatingthe backstop, now known as the Terrorism Risk Insurance ProgramReauthorization Act (TRIPRA) after its first renewal in 2007,renewed in its current form. H.R. 508, legislation renewing theprogram through 2019, was introduced in February.

The chief sponsor of the legislation is Rep. Michael Grimm(R-N.Y.) Interestingly, the only committee chairman named as aco-sponsor was Rep. Pete Sessions (R-Texas), chairman of the HouseRules Committee.

Jimi Grande, senior vice president of federal and politicalaffairs at the National Association of Mutual Insurance Companies,says NAMIC had been calling for an extension to the TRIA programbefore the tragic events in Boston, and we will continue topress lawmakers to act as swiftly as possible, but he adds, atthis time “the focus of the government's efforts should be onhelping the victims and pursuing those who perpetrated this heinousact.”

“When we return to the debate over TRIA, with a sad reminderthat the threat of terrorism has never left us, NAMIC will continueto make the same arguments we've made all along–that TRIA is avital part of our nation's economic defense; that terrorism is aunique risk whose very nature makes it impossible for insurers tocover against major events; and that the information needed to evenbegin to price coverage is rightly kept classified as a matter ofnational security.”

Ken A. Crerar, president and CEO of The Council of InsuranceAgents & Brokers, says, “In the coming days, weeks and monthsahead, this senseless tragedy will be invoked as a part of thedebates on all facets of terrorism–intelligence, readiness, and,yes, financial security.”

Willem O. Rijksen, vice president of public affairs for theAmerican Insurance Association, added that, “Our thoughts andprayers are with the victims and people of Boston. Mostunfortunately, this tragedy reminds us all of the continued threatposed by terrorist attacks.”

In recent comments at the National Association of InsuranceCommissioners meeting in Houston, Robert Gordon, senior vicepresident of policy development and research for the PropertyCasualty Insurers Association of America, says that whilereauthorization is likely to receive strong support in Congress,success may come late in the process.

Additionally, Gordon also said terrorism is a national securityissue of concern to all citizens. In remarks mademore relevant in the wake of the Boston event, Gordon said,“Terrorism plots have been attempted all across the nation inalmost all regions. Remember that the second largest successfulterrorist attack in the United States was in Oklahoma City.”

In a statement today on the Boston bombing, Nat Wienecke, PCI'ssenior vice president of federal government relations,says ”Our thoughts and prayers are with all those impacted bythe tragic events in Boston. There will be a time and placefor policy debates on the Terrorism Risk Insurance Act, but todaywe are focused on helping the people of Boston and the marathonparticipants.”