NMHC and NAA joined over 340 businesses, trade groups and organizations from across the country in calling on Congress to move swiftly to pass a long-term extension of the Terrorism Risk Insurance Act (TRIA). The program serves as a public/private insurance risk sharing mechanism to help insure against losses resulting from a catastrophic terrorist attack. TRIA is set to expire in December 2020.
Reauthorizing the program is a top priority for the apartment industry. Many apartment owners, operators and developers are required by their lenders to secure terrorism risk insurance as part of their effort to protect the underlying loan yet are often unable to secure that coverage exclusively through the private sector.
Congress has begun discussions on how best to reauthorize and reform the program to ensure property owners are able to secure terrorism risk insurance when required to do so by lenders. In fact, the Subcommittee on Housing, Community Development, and Insurance and the Subcommittee on National Security, International Development, and Monetary Policy have announced that a hearing will be held on October 16 to discuss reauthorization. Without the government’s backstop in place, experts expect the private sector to be unable or unwilling to offer coverage because of how difficult it is to model terrorism risk.
NMHC and NAA will continue to press Congress to quickly reauthorize the Terrorism Risk Insurance Act well in advance of its expiration so as to avoid disruption in the real estate marketplace. Additionally, NMHC and NAA will continue to advocate that any reforms of the program not negatively impact terrorism insurance affordability for apartment firms.
For background on TRIA and more information on the industry’s advocacy work, click here.