Insurance Update: House Passes TRIPRA Extension
After the Terrorist Acts occurred on the World Trade Center back in 2001, the Government passed the Terrorism Risk Insurance Act (TRIA) of 2002. This meant that if the Government deemed an event as a certified act of terrorism, then the Government would reimburse the insurance companies for the losses they paid out for that specific event.
However, if there is an event and the Government does not deem it as a certified act of terrorism, then insurance companies do not get reimbursed for the losses. This could ultimately affect the insured, as they could be at a loss as well since there was no coverage.
TRIA has been extended multiple times throughout the years with minor changes. Recently, the House of Representatives voted to pass the latest TRIA extension, the Terrorism Risk Insurance Program Reauthorization Act (TRIPRA) of 2019. The bill has moved to the Senate for voting.
The current TRIPRA is set to expire December 31, 2020, but Congress is actively trying to move the bill along sooner rather than later. The last renewal occurred after the policy expired which caused panic and policy lapses; Congress is trying to avoid that this time around.
The bill remains mostly the same, with one major provision to include language regarding a study on relevant cyber exposures. This study will review the overall vulnerabilities on the United States infrastructure. Companies can purchase Cyber Liability coverage under their corporate policy; the Government wants to analyze that in a certified act of terrorism, will that coverage be enough?
In addition to TRIA, a company can obtain separate Terrorism Coverage under their corporate policy that would cover acts of Terrorism not certified by the Government. Each policy is written differently, so it is important to talk with your Broker if you need this coverage and if you’re protected for your line of work.
If you have any additional questions regarding the current TRIPRA extension or if your company needs additional coverage, reach out to us today!
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