Emergency-response managers from most major cities say they need more federal funds and information than they currently receive if they are to properly respond to a terrorist attack involving a radiological dispersal device (RDD) or an improvised nuclear device (IND), the Government Accountability Office says in a new report.

The report said that of 27 major cities interviewed, most had assessed their ability to respond to an attack from a radiological or nuclear device and had ranked the risk of these attacks as lower than the risk of other hazards they face.

However, most emergency managers reported to GAO that they need more federal technical and resource assistance than currently provided if they are to properly respond to such an attack.

“GAO found that federal guidance on the type and timing of such assistance is not readily available or understood by all emergency managers,” the report says. “This condition could lead to a disjointed and untimely response that might increase the consequences of either kind of attack.”

The report adds that emergency managers in the 27 cities contacted by GAO said there is also a need for improved procedures and more information, a matter that the Federal Emergency Management Agency is trying to address.

“Most emergency managers reported their city needed federal funding to maintain current capabilities to respond to RDD and IND attacks,” the GAO says.

According to DHS guidance, GAO notes, response capabilities are developed through planning, training, equipping, and exercising, “which are essential elements of an integrated, capability-based approach to preparedness.”

The report was issued at the request of members of Congress as they debate when and if to renew the current Terrorism Risk Insurance Act.

The law currently in place sunsets Dec. 31, 2014. Both the House and Senate committees held hearings on the issue late last month, but no member of the two committees committed himself or herself to reauthorizing the program.

The issue of coverage for Nuclear, Chemical, Biological and Radiation (NCBR) was repeatedly brought up at the hearings.

Peter J. Beshar, executive vice president and general counsel of Marsh & McLennan, New York, said at the House hearing that Congress should specifically clarify during the reauthorization process that coverage should be provided by TRIA for all forms of terrorism (i.e., conventional and NBCR) if coverage is afforded on the primary policy.

Beshar said “there is ambiguity” in the market currently as to whether TRIA covers workers' compensation in the event of an NBCR-related act.

He also said a reauthorized TRIA should clarify that it addresses cyber terrorism, which he called a “new terrorism risk.”

Industry officials are meeting regularly to discuss ways of getting Congress to deal with the issue as soon as possible, but the industry consensus is that “nothing will happen this year, and the heat won't get strong until policyholders feel threatened, and that's probably middle of next year,” according to an industry lobbyist.

Besides NCBR, cyber risk is emerging as a key concern for both carrier and insureds. “The interest is exploding right now,” one industry lobbyist said. “We had a meeting with the top cyber dogs at the White House in August, and there's a lot of concern about take-up rate (or lack thereof) and how prepared industry is for the imminent attack— apparently within the next five years.”

The lobbyist acknowledged that the “take-up rate is actually pretty high considering the lower profile of the product line, but we have members wanting to lead on this and looking for some visibility here—hopefully include clarity in the TRIA bill.”

Special Reports /

Amid TRIA Debate, Concerns Raised over State's Preparedness for NCBR Attacks

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