House Panel Weighs Extension of Federal Terrorism Risk Insurance Program

The House Financial Services Committee is considering legislation this week (H.R. 7128), introduced by Reps. Mike Flood (R-NE) and Andrew Garbarino (R-NY), that would extend the federal Terrorism Risk Insurance Program (TRIP) through 2034.

The federal backstop for terrorism risk was first established in late 2002 through the Terrorism Risk Insurance Act (TRIA), following insurers’ widespread exclusion of terrorism coverage from commercial property and casualty policies in the aftermath of the Sept. 11 terrorist attacks. The program was designed to stabilize the insurance market by ensuring the continued availability of terrorism risk coverage.

TRIA has been reauthorized multiple times, most recently at the end of 2019, and is set to expire on Dec. 31, 2027. The proposed legislation would extend the program for an additional seven years, through 2034.

Under TRIA, insurers are required to offer terrorism coverage, while the federal government provides a financial backstop if losses from a certified act of terrorism exceed a specified threshold. The bill also proposes changes to the certification process for acts of terrorism, which determines when federal assistance is triggered. Most notably, it would increase the minimum loss threshold for certification from $5 million to $25 million.

The American Society of Association Executives (ASAE) has long supported TRIP as a critical safeguard for meetings, events and other activities that could be impacted by acts of terrorism.

This article was provided to OSAP by ASAE's Power of Associations and Inroads.