On December 20, 2019, President Trump signed a spending bill that includes a 7-year extension of the Terrorism Risk Insurance Act (TRIA).
TRIA was originally passed in November 2002 as a response to the insurance industry’s inability to cover the scale of losses associated with the September 11 attacks. On a prospective basis, acts of terrorism continue to present numerous challenges in modeling risk due to the infrequency, unpredictability, and of the magnitude of potential attacks. According to CRE Financial, Federal participation in supporting private insurance provides the support and certainty of coverage for policyholders and avoids the potential disruption that a lapse in coverage would create.
The bill essentially left the TRIA program structure unchanged, as significant reforms occurred in the last reauthorization effort. TRIA is now reauthorized through December 2027.