First passed by Congress in 2002 in response to the terrorist attacks of September 11, 2001, the Terrorism Risk Insurance Program (TRIA) was created to provide a federal backstop for terrorism insurance coverage.
WASHINGTON, D.C. – Continuing its push for an extension of the Terrorism Risk Insurance Program Reauthorization Act of 2007 (TRIPRA), the American Hotel & Lodging Association (AH&LA) sent a letter to Senate Banking, Housing and Urban Affairs Committee Chairman Tim Johnson (D-SD) and Ranking Member Michael Crapo (R-ID) to press for swift Senate action.
First passed by Congress in 2002 in response to the terrorist attacks of September 11, 2001, the Terrorism Risk Insurance Program (TRIA) was created to provide a federal backstop for terrorism insurance coverage, which had become largely unavailable or cost prohibitive. The program was renewed in 2005 and again in 2007 (as TRIPRA), and the current extension is due to expire in December 2014.
In the letter to Senators Johnson and Crapo, AH&LA President and CEO Katherine Lugar noted, “Without TRIPRA, the lodging industry will face substantial difficulty in obtaining terrorism risk coverage which is often required for securing loans for development projects… Importantly, TRIPRA protects American taxpayers as the program mandates that ‘first dollar losses’ be paid by insurers and policy holders and is only triggered in the event of a major event and after individual insurer loss thresholds are met.”
The lodging industry is concerned that the terrorism risk market is not prepared to provide coverage without the private/public partnership provided through TRIPRA. The program has allowed terrorism insurance coverage prices to stabilize and for adequate coverage to be secured with minimal risk to taxpayers.
The Senate Banking Committee held its first hearing on TRIA reauthorization yesterday.
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