The Republican-led Financial Services Committee in the House of Representatives put forward a draft proposal outline to reauthorize the Terrorism Risk Insurance Program Reauthorization Act (TRIPRA) on May 1, 2014. After further negotiations, the House Republican leadership presented the TRIA Reform Act of 2014 on June 11 that proposes a five-year reauthorization of the federal program (to the end of 2019) with a similar copay structure to that of the Senate bill. The full senate passed their committee’s recommended version 93-4 on July 17, 2014. However, a number of changes have also been proposed that have the potential to impact the market if fully implemented, including higher program triggers for non-nuclear, biological, chemical and radiological (NBCR) events, an increase to the recoupment rate and an enhancement to the program’s taxpayer repayment requirements. The table below outlines the different terms and durations that have been put forward by the Senate and the House.
Significant uncertainty therefore remains over the final terms and timing of reauthorization. Further clarifications are expected in the coming weeks and months. Guy Carpenter will keep clients, prospects and markets informed of all significant developments as the renewal progresses throughout the year.