Terrorism Coverage Rule Extended One Year
The Treasury Department has extended a key provision of the Terrorism Risk Insurance Act that requires commercial property and casualty insurers to offer terrorism insurance policies for another year.
Treasury officials had until Sept. 1 to extend the "make available" provision of TRIA through 2005.
However, Treasury officials said they acted well in advance of the deadline "to avoid any potential disruption" in the insurance market.
They were also under pressure from real estate interests, lenders and congressional leaders to act quickly.
"The terrorism risk insurance program has been an important confidence builder as this country recovered from the attacks of Sept. 11 and the recession," secretary John Snow said.
The Mortgage Bankers Association and American Bankers Insurance Association welcomed the extension.
"The extension of TRIA's 'make available' provision is a great step forward in stabilizing the insurance market," MBA senior vice president Gail Davis Cardwell said.
It will provide certainty of coverage and bolster liquidity in the commercial real estate market, she explained.
Meanwhile, members of the House Financial Services Committee have introduced a bill to extend TRIA from two years through 2007.
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