Terrorism Insurance
Terrorism Risk Insurance is an integral part of commercial real estate financing and an important financial backstop for the American tax payer. The current extension of TRIA is set to expire on December 31, 2020. BOMA, as a steering committee member of the Coalition to Insure Against Terrorism (CIAT), has been working all year on an early extension of TRIA so policy holders do not have their coverage interrupted. On October 31, 2019, the House Financial Services Committee unanimously passed a 7-year extension of TRIA paving the way for the legislation to move forward.
BOMA Position
Terrorism will remain a threat for the foreseeable future; the federal terrorism insurance program must remain in effect until the reinsurance industry is prepared to accurately underwrite and assume the whole risk.
Background
Following the September 11, 2001 terrorist attack, many owners of commercial properties were advised that their policies would not be renewed or that their new policies would exclude terror/war risks. Without adequate insurance, it is difficult, if not impossible, to operate or acquire properties, refinance loans, and to sell commercial-backed securities.
Since 9/11, BOMA and our coalition partners in the Coalition to Insure Against Terrorism (CIAT) have worked tirelessly to promote and implement a federal backstop program. We scored huge victories when Congress passed the Terrorism Risk Insurance Act of 2002 and again in late 2005, 2007 and 2015 when Congress voted to on TRIA extensions.
TRIA has a zero cost long-term tax payer liability as any claims paid out immediately following an act of terrorism would be recouped over the next ten years through premiums on policy holders. TRIA protects not only commercial real estate, but educational institutions, research facilities, sports complexes and more.
Resources
BOMA TRIA Support Letter