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On Sept. 11, 2012 the Subcommittee on Insurance, Housing and Community Opportunity held a hearing entitled “TRIA at Ten Years: The Future of the Terrorism Insurance Program”. By invitation only, NAR submitted testimony and was represented by 2012 NAR Commercial Committee Vice-Chair, Linda St. Peter, CCIM, CIPS (Prudential Connecticut Realty in Wallingford, CT.) Linda testified on behalf of NAR and its commercial affiliates: CCIM Institute, Institute of Real Estate Management, REALTORS® Land Institute, and Society of Industrial and Office REALTORS®. The purpose of the hearing was to provide an overview and begin the conversation about how TRIA has worked, how TRIA has affected various stakeholders, what the private market’s current capacity is to provide terrorism insurance, and what Congress can do to encourage greater private sector participation.


Following the terrorist attacks of September 11, 2001, insurers backed out of the terrorism insurance market place prompting Congress to create a federal reinsurance backstop program in the Terrorism Risk Insurance Act of 2002 which also mandated that insurers make terrorism coverage available along with its property and casualty lines. In Dec. 2005, Congress passed the Terrorism Risk Insurance Extension Act (TRIEA), which extended the federal terrorism insurance backstop program for an additional two years. On Dec. 26, 2007, just days before the Act was once again set to expire, President Bush signed H.R. 2761 into law to extend the program for an additional seven years through the end of 2014.

What's At Stake

American businesses continue to rely upon the availability and affordability of terrorism risk insurance. The federal backstop program is a critical component of the private/public partnership created to protect the nation’s business sector by ensuring that adequate insurance coverage is available to effectively manage economic risks. This is has been a particular concern for those in commercial real estate who need to have terrorism coverage in place in order to secure financing. Commercial mortgage-backed security (CMBS) borrowers face the threat of default and bond downgrades without adequate coverage. In the retail and multifamily sectors specifically, a jump in terrorism insurance premiums can reduce the value of commercial properties. If terrorism insurance becomes unavailable again this throws the financing into technical default.

What NAR is Doing

Because of the importance of terrorism insurance coverage to commercial real estate, NAR supports the continued availability and affordability of coverage made possible by the federal backstop program of the “Terrorism Risk Insurance Act of 2002” and its extensions.  Unfortunately, despite a bipartisan reauthorization bill, the United States Senate failed to renew the Terrorism Risk Insurance Act (TRIA) due to non-TRIA related provisions in the legislation.  This alarming failure to act before adjournment could stall commercial real estate development around the country and affect the financing for properties already in existence. Please visit our Political Advocacy page for more information about our advocacy efforts.

How to Get Involved

REALTORS® can get involved today by staying informed on TRIA and NAR’s policy supporting terrorism insurance coverage: