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.
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 when Congress voted to extend TRIA for an additional two years. On December 26, 2007, just days before the Act was once again set to expire, President Bush signed H.R. 2761 into law to extend the program for an addition seven years through the end of 2014.
In addition to extending the federal program, the Terrorism Risk Insurance Program Reauthorization Act of 2007 (TRIPRA) expands the definition of "act of terrorism" to allow the certification of acts of "domestic terrorism"; clarifies the operation of the $100 billion annual program cap; and changes the manner in which the mandatory portion of post-event policyholder surcharges would be collected. It also requires the U.S. Government Accountability Office (GAO) to conduct a study of the availability and affordability of insurance coverage for nuclear, biological, chemical and radiological (NBCR) acts of terrorism.