econintersect.com
       
  

FREE NEWSLETTER: Econintersect sends a nightly newsletter highlighting news events of the day, and providing a summary of new articles posted on the website. Econintersect will not sell or pass your email address to others per our privacy policy. You can cancel this subscription at any time by selecting the unsubscribing link in the footer of each email.



posted on 13 June 2015

Federal Reinsurance For Terrorism Risk In 2015 And Beyond

by Congressional Budget Office

The September 11, 2001, terrorist attacks resulted in nearly 3,000 deaths and roughly $44 billion of insured losses (in 2014 dollars). In light of the unexpected and unprecedented losses from the attacks, as well as the heightened uncertainty surrounding future losses, private insurers subsequently sharply reduced the availability of terrorism coverage for businesses and commercial properties.

Policymakers were concerned that without terrorism insurance, financing for commercial development projects in highrisk areas would be unavailable and that new construction and job creation would be reduced, thereby slowing economic growth. (Estimating how large those effects would have been is difficult, in part because some construction and job creation would probably have shifted to lower-risk areas; such shifts might have reduced losses in the event of future attacks.)

In response, lawmakers enacted the Terrorism Risk Insurance Act (TRIA) in 2002 as a temporary measure to provide catastrophic federal reinsurance for terrorism risk without charging premiums up front. Although no major terrorist attacks have occurred in the United States since 9/11 and thus the government has paid no claims, the threat of terrorist attacks persists. Lawmakers reauthorized TRIA in 2005 and 2007 and again in January 2015 for six years, just days after the program lapsed at the end of 2014. The law requires primary insurers to offer terrorism coverage on business and commercial policies (including workers' compensation insurance). By coupling that requirement with a federal reinsurance program, which protects insurers against large losses, TRIA helps to ensure the availability of insurance coverage and might reduce insurers' insolvencies and economic disruption after a large terrorist attack. But, as structured, the program exposes the government to a significant amount of financial risk and subsidizes policyholders (many of which are large businesses).

[click on image below to continue reading]

Source: http://www.cbo.gov/sites/default/files/114th-congress-2015-2016/workingpaper/50171-TRIA_Working_Paper.pdf

Click here for Historical News Post Listing










Make a Comment

Econintersect wants your comments, data and opinion on the articles posted.  As the internet is a "war zone" of trolls, hackers and spammers - Econintersect must balance its defences against ease of commenting.  We have joined with Livefyre to manage our comment streams.

To comment, using Livefyre just click the "Sign In" button at the top-left corner of the comment box below. You can create a commenting account using your favorite social network such as Twitter, Facebook, Google+, LinkedIn or Open ID - or open a Livefyre account using your email address.



You can also comment using Facebook directly using he comment block below.





Econintersect Contributors


search_box

Print this page or create a PDF file of this page
Print Friendly and PDF


The growing use of ad blocking software is creating a shortfall in covering our fixed expenses. Please consider a donation to Econintersect to allow continuing output of quality and balanced financial and economic news and analysis.


Take a look at what is going on inside of Econintersect.com
Main Home
Analysis Blog
Are You Feeling the Economic Surge?
Big Mess in Italy
News Blog
Multiple Jobs Needed To Make Ends Meet
The Final Crisis Chronicle: The Panic Of 1907 And The Birth Of The Fed
Is There A Gender Wage Growth Gap?
Moving Averages Can Identify A Trade
Infographic Of The Day: Hobbies That Will Make You Money
Earnings And Economic Reports: Week Starting 05 December 2016
Early Headlines: Green Pty Cancels - Then Appeals PA Recount, IRS Serves Summons On Bitcoin Co, Most Mfg Jobs Lost To Automation, 2017 US Hosing Outlook And More
The Smartphone Market Is Not A Two-Horse Race
Italy's Referendum: What's At Stake And What You Need To Know
There Were Over A Million Casualties At The Somme
The Best Countries In The World
What We Read Today 03 December 2016 - Public Edition
Big Mac Index In Its 30th Year
Investing Blog
How To Invest When The Fed Destroys Capitalism
Technical Thoughts: Manage Risk
Opinion Blog
Why Did Trump Win? A Different Perspective, Part 3
Jobs Without Disruptions Through Concordian Economics
Precious Metals Blog
Silver Prices Rebounded Today: Where They Are Headed
Live Markets
02Dec2016 Market Close: WTI Crude Climbed Back Up To Previous 51 Handle, US Dollar Index Trading At The100 Level, Oil Rig Count At 10-Month High
Amazon Books & More






.... and keep up with economic news using our dynamic economic newspapers with the largest international coverage on the internet
Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government



Crowdfunding ....






























 navigate econintersect.com

Blogs

Analysis Blog
News Blog
Investing Blog
Opinion Blog
Precious Metals Blog
Markets Blog
Video of the Day
Weather

Newspapers

Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government
     

RSS Feeds / Social Media

Combined Econintersect Feed
Google+
Facebook
Twitter
Digg

Free Newsletter

Marketplace - Books & More

Economic Forecast

Content Contribution

Contact

About

  Top Economics Site

Investing.com Contributor TalkMarkets Contributor Finance Blogs Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2016 Econintersect LLC - all rights reserved