US terrorism cover after TRIA

US terrorism cover after TRIA

A recent US Treasury report found that the Terrorism Risk Reinsurance Program (TRIA) signed into law by President Bush in 2002 has been effective in meeting its goals of supporting the industry during a transitional period and stabilizing the private insurance market. The Administration opposes a straight extension of the program. It takes the view that extending TRIA in its current form is likely to discourage the private market development needed to deal with the risk of terrorism. In his recent testimony on TRIA before the Committee on Financial Services in the House of Representatives, Treasury Secretary John Snow said that the expansion of terrorism risk coverage availability and take-up, and the decline in cost even as the TRIA deductible was increase from 7% to 15% between 2002 and 2004, highlights the improvement in the industry's ability to cover terrorism risk. This an edited extract from Mr Snow's testimony.