N.Y. Legislators Call For TRIA Passage

New York State lawmakers voted today to approve a resolution calling for Congress to extend the Terrorism Risk Insurance Act.

The state Senate voted in favor of the measure, legislative resolution 2563, which was introduced by Senate Insurance Committee Chairman James Seward, a Republican representing several upstate counties.

The resolution says that, "Failure by Congress to extend TRIA would likely result in the inability of insurers to offer coverage for future catastrophes resulting from terrorism.

"Without a backstop, limited availability of insurance against terrorism would have a severe adverse effect on our country's economy as financiers would be reluctant to lend, businesses would be reluctant to invest, and consumers would be unable to afford insurance."

Insurance associations, which had sought introduction and passage of the resolution, noted that the vote added New York State lawmakers to the chorus of groups calling for a TRIA extension.

"The New York Senate joins other elected officials such as the U.S. Conference of Mayors and private sector policyholders throughout the country in recognizing this urgent need," said Leigh Ann Pusey, senior vice president of government affairs for the American Insurance Association.

Insurance companies and trade associations, among others, have noted that TRIA has played an important role in stabilizing the economy by enabling companies to provide terrorism coverage at reasonable rates.

If TRIA is allowed to expire as scheduled at the end of the year, many stakeholders have said the lack of availability for terrorism coverage could cause a slowdown in the markets as construction and other vulnerable projects are put on hold.

"We are pleased that New York legislators recognize the importance of TRIA and are urging those on Capitol Hill to secure an extension of the act," said Kristina Baldwin, regional manager and counsel for Property and Casualty Insurers Association of America (PCI). "Without a federal terrorism insurance backstop in place, market disruption is a near certainty."