Insurance industry leaders continue to watch with anxious yet definite optimism as congressional negotiations over a renewal of the Terrorism Risk Insurance Act (TRIA) continue to stall.
As of yesterday, one senator remains the prime holdout in agreement to a version of TRIA renewal passed by the House last week: Tom Coburn.
The retiring Republican is blocking the Senate from voting on the bill unless provisions are made allowing states to opt out of the National Association of Registered Agents and Brokers (NARAB), the organization that would allow producers to become licensed to sell insurance in all states. The NARAB language was included in the House version of the bill, and represents a long fight by industry professionals to establish the program.
“We’re totally taking away the right of a state to control its own destiny in terms of insurance,” Coburn told the Association Press regarding his opposition.
The senator has placed a hold on the bill, which will make it difficult for Senate leaders to force a vote before the chamber is expected to adjourn Thursday. A spokesman for the Senate Democratic Policy and Communications Center confirmed, “We’re running out of time.”
Senate Democrats accuse House Republicans of giving Coburn the power to derail TRIA by failing to pass the Senate-approved bill in July. Because the House made changes to the bill, the bill had to come back to the Senate for final approval, where Coburn is currently blocking it.
For industry professionals, concern over TRIA’s future is rampant, says Jennifer Rubin, underwriting manager for terrorism, war and political violence with
Hiscox.
“I think there’s a high level of anxiety among insurers right now,” Rubin told
Insurance Business America. “We’re getting updates practically hourly from various lobbying organizations in trying to get this passed.”
Many industry leaders fear failure to renew the program could result in unaffordable rate increases in certain lines such as workers’ compensation. It could also jeopardize funding for major construction and public works projects, and make events with sports leagues and entertainment companies even more risky.
Still, Rubin and others remain optimistic.
“The current underwriting appetite is to write business beyond the expiration of TRIA,” she said. “Rates could go up, but it is such a competitive environment these days that it seems it would take a massive run to make a rate change.”
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