The Report on the Terrorism Risk Insurance Act supports industry assertions that the availability of terrorism risk insurance is tightening in light of uncertainty around the program's renewal.
Industry groups also supported the report's finding that "the private market does not have the capacity to provide reinsurance for terrorism risk to the extent currently provided by TRIA," as PCI Senior Vice President Robert Gordon states.
But both PCI and AIA questioned the finding that increasing the industry's skin in the game through additions to the co-share, deductible, or trigger would not impact availability.
AIA president and CEO Leigh Ann Pusey says AIA is "concerned with any effort to increase insurer retentions as this could lead to decreased market capacity."
Gordon says, "[I]t is important to note that increasing the industry share through the co-share, deductible or trigger will affect the availability and affordability of terrorism insurance for consumers."
Lawrence Mirel, a partner at international insurance law firm Nelson Levine de Luca & Hamilton, says the Senate TRIA extension bill envisioning an extension for a limited time with increased insurer deductible and a higher threshold represents a "likely compromise," but he wonders if the increases will be enough for the members of the House "who are dubious about whether the TRIA should be extended at all?"
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.