Skip Ribbon Commands
Skip to main content

Big "I" Supports Long-Term Terrorism Insurance Reform

New York agent testifies on need for federal action

WASHINGTON, D.C., June 21, 2007—The Independent Insurance Agents & Brokers of America (the Big “I”), the nation’s largest insurance association, testified today before the House Committee on Financial Services Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises in support of H.R. 2761, the Terrorism Risk Insurance Revision and Extension Act of 2007 (TRIREA).

Sharon Emek, immediate past chair of the Independent Insurance Agents & Brokers of New York (IIABNY) and an independent agent, made the case that the TRIA program should be extended before it expires at the end of this year.  On behalf of the Big “I” she expressed strong support for the recently introduced legislation by Rep. Michael Capuano (D-Ma.) and Chairman Barney Frank (D-Ma.) and noted that, if enacted, the legislation would continue to keep terrorism coverage both available and affordable.

“The current public-private partnership created by TRIA, and extended in TRIEA, has worked well and generally as intended, allowing businesses across America to continue operating and growing, and preserving jobs in the process,” Emek testified.  “Unfortunately, the program is scheduled to expire at the end of this year, and there is no reason to believe that the threat of terrorism is on the decline, or that the private insurance markets alone can adequately meet our nation’s need for coverage. “

Emek expressed the Big “I”’s support for H.R. 2761’s ten year extension of the federal terrorism insurance backstop because the industry does not currently have the capacity to provide terrorism coverage on its own.  “Despite our optimism that the federal government’s role in terrorism insurance can be reduced over time, the terrorism insurance market is not ready to stand on its own by the end of this year and is not likely to be ready for a number of years to come,” said Emek.  “Accordingly, now is the time to enact a long-term extension of the federal terrorism insurance backstop with mechanisms for building more private market capacity.”

Emek stressed that the organization represents agents and brokers selling coverage all across the country and terrorism insurance is not just a big city problem.  She said there is a need for reasonable trigger levels that meet the needs of the communities, large and small, which rely on terrorism coverage, as well as those of the insurers, both large and small, that offer coverage, and that the bill provides for that.

“TRIREA’s $50 million trigger is a reasonable level that would keep terrorism coverage both available and affordable and protect the communities that our members serve.  The Big “I” strongly supports this provision,” said Emek.

In addition, Emek outlined the need to provide coverage for losses from nuclear, biological, chemical or radiological (NBCR) events, pointing out that even though NBCR losses are perhaps the most catastrophic types of terrorist attacks, these types of losses are currently excluded from most existing terrorism risk insurance coverage.  Emek also acknowledged that many insurers, particularly small and medium-sized companies, may still find it difficult to underwrite NBCR risk even with a federal backstop and expressed support for provisions that reasonably balance customers’ need for such insurance and insurers’ difficulty providing it.

 “Based on our experience in the market, we know that policyholders desire a long-term solution to the availability of terrorism risk insurance, including coverage for NBCR events,” said Emek.  “H.R. 2761 would further enhance TRIA’s public-private partnership by expanding its “make available” requirement to include NBCR coverage.  The bill also recognizes the difficulties that insurers will face in providing this coverage by including a lower deductible for NBCR events, a step-down mechanism to decrease insurer co-payment for larger NBCR events, and rate and form interim implementation standards to ease the transition in the first year of the extension.”

 Finally, Emek endorsed the bill’s creation of a 19-member blue-ribbon commission to propose long-term solutions to covering terrorism risks.  “The Big “I” strongly supports this approach to developing long-term solutions and is pleased that the views of independent insurance agents and brokers will be represented on the commission.” said Emek. 

 Founded in 1896, IIABA (the Big “I”) is the nation’s oldest and largest national association of independent insurance agents and brokers, representing a network of more than 300,000 agents, brokers and their employees nationally. Its members are businesses that offer customers a choice of policies from a variety of insurance companies. Independent agents and brokers offer all lines of insurance—property, casualty, life, and health—as well as employee benefit plans and retirement products. Web address:


​127 South Peyton Street
Alexandria VA 22314
​phone: 800.221.7917
fax: 703.683.7556

Follow Us!

​Empowering Trusted Choice®
Independent Insurance Agents.