Terrorism Risk Insurance Vital to Commercial Real Estate
Commercial real estate deals could come to a screeching halt in major metropolitan areas if Congress doesn’t act this year to extend the Terrorism Risk Insurance Act. Commercial lenders require properties in high-risk areas to be insured against acts of terror, but insurers are wary of writing policies without a government backstop in the event of mass property destruction. That’s why commercial REALTORS® are calling on the U.S. House and Senate to reauthorize the TRIA bill this year.
The Senate is considering a version of the bill that would extend TRIA for another seven years and enable the U.S. Treasury Department to loan private insurers the money to start covering claims due to acts of terrorism after losses reach $100 million. Leaders of the House Financial Services Committee have introduced their own TRIA reauthorization bill, which would restrict the government’s involvement in the program by increasing the trigger to $500 million and only extending the program for five years.
Reach out to REALTOR® commercial members who were in the business before and after the September 11 terrorist attacks and talk to them about their experiences with terrorism insurance. Ask about the affordability and availability of terrorism insurance coverage and its impact on commercial real estate transactions.