- Terrorism Insurance Deal Close
- February 13, 2015
- Law Firm: McDonald Hopkins LLC - Cleveland Office
House and Senate negotiators are closing in on a compromise plan to renew the terrorism-risk insurance program, a federal backstop to help businesses and other groups to continue obtaining coverage for damages in a catastrophic attack.
The measure has been a source of division on Capitol Hill for months, as a band of fiscal conservatives, led by House Financial Services Chairman Jeb Hensarling (R-TX), has battled Democrats, some Republicans, and a host of industry groups over the government's role as an insurer of last resort. In the end, neither side of the fight got everything it wanted.
Initially enacted after the Sept. 11, 2001, terror attacks, the program is set to expire at the end of 2014.
An apparent compromise being finalized would continue the program for another six years, and raise the threshold at which the federal cost-sharing for insurance kicks in to $200 million in damages from a terrorist strike.
A Senate approach would maintain the existing $100 million threshold for another seven years, under a bill sponsored by Democratic Sen. Chuck Schumer (D-NY) that passed 93-4 in June with overwhelming bipartisan support. In other words, if insurance losses incurred in a terrorist attack exceeded $100 million, the federal government would pay the balance of the claims.
But Hensarling and other House conservatives had been pushing a bill that would have raised the trigger from $100 million to $500 million.
The compromise of a $200 million threshold for six years taking shape could be attached to spending legislation anticipated next week to keep the government funded beyond Dec. 11.