Senate passes TRIA, sends bill to Obama's desk

The National Association of Professional Insurance Agents (PIA) "is very pleased that the leadership of the new Congress made this its first priority upon convening," says PIA National Executive Vice President and CEO Mike Becker. "The overwhelming votes in both the House and the Senate demonstrate that when it comes to protecting the citizens of the United States against terrorism, there is no partisanship on Capitol Hill. We are hopeful that this forging of bipartisan consensus will serve as a template for dealing with other insurance issues going forward."

"The Big 'I' is proud that all of our hard work on TRIA and NARAB II has come to fruition and will benefit thousands of small businesses and insurance consumers across the country," says Bob Rusbuldt, Big "I" president & CEO. "Today's bipartisan action by the Senate on both TRIA and NARAB II, in one of the first acts of the new Congress, represents a culmination of years of hard work of the Big 'I' and our small business members, and I offer our members a sincere and heartfelt congratulations. Long awaited reform on non-resident licensing for agents is finally coming."

The bill extends TRIA for six years, and increases the amount needed in total losses before the TRIA program kicks in from the current $100 million to $200 million, at a rate of $20 million a year beginning in 2016. The bill also raises the federal government's mandatory recoupment from $27.5 billion to $37.5 billion, increasing by $2 billion each year beginning Jan. 1, 2016. For all events, the bill would raise the private industry recoupment total from the current 133% of covered losses to 140% of covered losses. 

"As with previous TRIA reauthorizations, the primary responsibility for financial recovery is placed on the private sector in all but the most catastrophic of events. TRIA provides policyholders and businesses the certainty they need to operate and grow our nation's economy," says Leigh Ann Pusey, president and CEO of the American Insurance Association.

Among its provisions, the bill's formulation of NARAB II would achieve much needed reciprocity in producer licensing and help policyholders by permitting greater competition among agents and brokers, the Big "I" said in a statement. This legislation would build upon regulatory experience at the state level, promote greater consistency in agent and agency licensing, and ease the burden that many agents face in doing business across state lines. A board of state insurance commissioners and industry representatives will govern NARAB.

Although the law will take effect upon President Obama's signature, "there will be significant work to do to establish the board, standards and requirements for the Association to be up and running," NAPSLO says in a statement.

Other industry groups praised Congress for TRIA's passage. 

"The Big 'I' is grateful to both the Senate and House leadership for making the reauthorization of TRIA and the passage of NARAB II a top priority in this new Congress," says Charles Symington, Big "I" senior vice president of external and government affairs. "We would like to specifically thank Sens. Jon Tester (D-Montana) and Mike Crapo (R-Idaho) in the Senate, and Reps. Randy Neugebauer (R-Texas) and David Scott (D-Georgia) in the House, for their tireless work in getting both TRIA and NARAB across the finish line."

The Coalition to Insure Against Terrorism commended Majority Leader Mitch McConnell and Minority Leader Harry Reid for encouraging bipartisam support for reauthorization in both chambers. "CIAT members are pleased the Senate has acted quickly to approve TRIA reauthorization as one of the first orders of business in the new Congress," said spokesman Marty DePoy.

"Members of Congress from both sides of the aisle have consistently voiced strong support for maintaining the TRIA program, as we saw from the overwhelming vote totals," says Charles M. Chamness, president and CEO of the National Association of Mutual Insurance Cos. "It was unfortunate that the program lapsed; however, we appreciate that the new Congress saw the need to act with all deliberate speed and cleared a bill in its very first week. We commend the leadership demonstrated here, and we hope the president will move swiftly to sign the bill into law."

David A. Sampson, president and CEO of the Property Casualty Insurers Association of America, says in a statement, "PCI is thankful to Congress for working with us on this priority for policyholders across America and our member companies. This vote is a significant win for consumers, taxpayers, and our members. This long-term legislation will minimize market disruptions, maintain the availability and affordability of terrorism insurance for consumers, and protect taxpayers. We also are grateful that NARAB II was included in the legislation. We urge President Obama to sign this legislation as soon as possible."

"NARAB will mean much-needed reciprocity in producer licensing," says National Association of Insurance and Financial Advisors President Juli Y. McNeely. "It will reduce red tape and improve efficiencies for our members who are licensed in multiple states. The legislation will benefit consumers as well by allowing them to maintain their preferred insurance agent or broker should they move to a different state.