Insurers Look For TRIA Coverage In Wake Of London Bombings
In the wake of the terrorist bombings in London, life insurers say they are as vulnerable to the fallout from a terrorist attack as property-casualty insurers and want inclusion in extension of the Terrorism Risk Insurance Act.
The American Council of Life Insurers in Washington, responding to the terrorist events in an expression of condolence, reiterated a statement issued by Frank Keating, ACLI president, in support of inclusion of group life insurance in an extension of TRIA, which is due to expire on Dec. 31.
Treasury Secretary John Snow indicated in a letter to Congress that continuation of the program could contribute to a "crowding out" of "innovation and capacity building" in the private market.
In his statement, Mr. Keating said: "Unlike the property and casualty industry, in the absence of TRIA, group life insurers are required by state law to offer terrorism coverage if they offer the product. As a result, group life insurers have been making changes to mitigate factors within their control. They are adjusting underwriting factors and working to control risk concentrations.
"However, despite these efforts, terrorism is and will remain an event that cannot be predicted with any degree of certainty, frequency or severity," he continued.
"We encourage Congress to move with all speed and alacrity to get TRIA extended. Nothing is more illustrative of the importance of this than the events of today," said Andy Barbour, vice president of insurance, technology and international affairs with the Financial Services Roundtable, Washington.
Mr. Barbour noted that there are two bills currently under consideration that include group life insurance in TRIA: HB 1153 and SB 467. He said the bills have a respective 24 and 30 co-sponsors. How far along these bills will progress is not totally clear, but he said that he is confident group life will be included in TRIA either through those bills or in a different bill or formulation.
The need for including group life is important, Mr. Barbour continued, because making sure that lives are insured is as important as making sure that businesses have business insurance.
Jim Connolly is Senior Editor of NU Life & Health Magazine
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