Is TRIA doomed?(A View From The Press Box)(Terrorism Risk Insurance Act of 2002)

National Underwriter Property & Casualty-Risk & Benefits Management, January, 2005 by Friedman, Sam

EXTENDING THE TERRORISM RISK Insurance Act seems like a no-brainer, but this wouldn't be the first time members of Congress would be guilty of not using their heads when they vote. What is the alternative? Dumping an unpredictable risk into the laps of the insurance industry, only to see carriers bankrupted when terrorists strike again? The party in power claims to be big believers in the free market, but do they understand that private individuals are free to refuse to put money at risk? That's what will happen if Congress kills TRIA and removes the critical reinsurance backstop it provides to carriers.

Without the government providing catastrophic coverage, insurers will exclude terrorism whenever they can. When they can't--such as with workers' comp--they...

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