Congress Seeks Compromise On TRIA Bill

The property-casualty industry is urging Congress to complete work on legislation extending the federal backstop for terrorism insurance as early as this week.

Congress is back to work after a two-week Thanksgiving break with a huge agenda, including the need to reconcile major differences between the House and Senate versions of the Terrorism Risk Insurance Act. But reconciling the relatively modest Senate version with more expansive House legislation might be difficult.

"Hopefully, the House, if they want to get [TRIA] done, will take what we do and pass it," Sen. Jim DeMint, R-S.C., said after the Nov. 16 Senate vote.

That has been interpreted by members of Congress and industry officials as saying that the only bill likely to be passed by a divided Senate this year will be through unanimous consent, and that the Senate has gone as far as it will go on TRIA extension.

The Senate bill--extending TRIA for seven years, through 2014--is similar to the current program, which expires Dec. 31.

At the same time, the Senate bill resolves difficult procedural budget issues raised by TRIA, while the House--which seeks a 15-year extension--delayed a decision resolving its budget issues, several lobbyists noted.

Joel Wood, senior vice president of government affairs at the Council of Insurance Agents and Brokers, conceded that brokers are "experiencing a high level of anxiety as they negotiate Jan. 1 policy renewals, with provisional exclusions for terrorism risk coverage in the event the act is not reauthorized."

He added that "we hope there can be a quick agreement between House and Senate leaders that would result in the measure moving in the next week, though it's not entirely clear how this is going to play out."

Sen. Chris Dodd, D-Conn., chair of the Senate Banking Committee, talked with Rep. Barney Frank, D-Mass., chair of the House Financial Services Committee, on Nov. 20, according to several congressional staffers. Rep. Frank sounded more conciliatory after the Senate vote on Nov. 16 than in a late October speech to the Property Casualty Insurers Association of America, in which he insisted he wouldn't be bullied into accepting the Senate version and proposed a "bridge bill" to maintain the status quo into next spring.

Rep. Frank and members of the New York delegation would like several provisions of the House bill added to the Senate version. These include special consideration for areas hit by a prior attack, like New York, and coverage for nuclear, biological, chemical and radiation attacks.

There is a widespread belief that the only concessions the House will get will be commitments by the Senate for hearings and extensive studies of the prior-target and NBCR issues--as well as a promise for prompt Senate consideration of the House bill reforming the National Flood Insurance Program, including a House call to add a wind coverage option to federal policies.