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May 19, 2024

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New Yorkers Join Maloney In Call For Terrorism
Insurance Extension

NEW YORK Congresswoman Carolyn B. Maloney (NY-12) and New Yorkers at Ground Zero today called on Congress to extend the Terrorism Risk Insurance Act – a program vital to New York’s economy. With less than 40 days left in Congress’s legislative calendar, quick action is needed to prevent the program’s expiration.

“After 9/11 you couldn’t get insurance for a hot dog stand—development stalled and New York was slow to rebuild – then Congress passed the Terrorism Risk Insurance Act,” said Maloney who is the lead Democratic sponsor of a bill to renew the program. “Now the program is set to expire, but the threat of another attack is still there and New York’s stadiums, theaters, and iconic buildings will lose their insurance, making our city even more vulnerable. The program doesn’t cost taxpayers a dime, but Congressional gridlock combined with opposition from hardline Republicans puts the program and our economy at great danger.”

Maloney objects to a provision of a bill passed by House Republicans on the Financial Services committee, which would reduce federal support for areas vulnerable to attack by increasing the TRIA “trigger”, or the point at which the government would step in to help, by 500 percent. This would make terrorism insurance less available to businesses, because it would force small- and medium-sized insurers out of the market entirely. That legislation is likely to receive a vote on the House floor in the next two weeks. The Senate is likely to take action on a stronger TRIA reauthorization in the coming weeks as well.

Warren W. Heck, Chairman & CEO of Greater New York Mutual Insurance Company said: “I am deeply concerned with a number of extreme changes in the TRIA House bill, particularly the increase in the trigger from $100 million to $500 million, that I believe will have a devastating impact on the US business community and economy.  This significant increase in the trigger will force mid-size and smaller insurance companies, which make up the vast majority of property & casualty companies operating in the United States, from doing business in New York City and other urban centers just as it did after 9/11.  This will have a significant impact on reducing the terrorism capacity available which as a result will become significantly more expensive and unaffordable.”

“New York City remains the number one terrorist target in the United States,” said Kathryn Wylde, President and CEO of the Partnership for New York City.  “As currently designed, the TRIA program works, and is what makes it possible to maintain our vibrant economy in the face of what we all recognize as a significant risk.”

“The extension of TRIA is critical to ensuring the jobs and revenue that are generated by building iconic landmarks in New York and across the nation can continue to operate and grow,” said Steven Spinola, President of The Real Estate Board of New York. “New York City is a symbol of freedom across our country and the world and therefore remains a target.  New York is fortunate to have Congressmembers Maloney and King’s leadership on this issue and Senators Schumer and Gillibrand who are leading the fight in the Senate for this enormously important legislation.”

A study by the Rand Corporation found that eliminating TRIA would cost taxpayers as much as $7 billion in the event of an attack. The greater federal spending would result from the need for greater federal disaster assistance due to an increase in uninsured losses.

The President’s Working Group on Financial Markets (PWG) released a report and analysis to Congress on terrorism risk insurance, which demonstrated that TRIA is still needed to maintain the affordability of terrorism insurance. The report also found that substantial changes to the program proposed by some Republicans would raise prices, putting insurance out of reach.

After the 9/11 terrorist attacks, many insurance companies excluded terrorism events from their insurance policies. As a result, Congress passed TRIA as a three year temporary program in 2002, which created a federal backstop to protect against terrorism related losses. Congress extended the program for two additional years in 2005 and for seven additional years in 2007. Maloney is the lead Democratic co-sponsor of the TRIA Reauthorization Act of 2013 to extend the Terrorism Risk Insurance Program for five years, through December 31, 2019.

Congresswoman Carolyn B. Maloney’s office