A new RAND Corporation study released on April 10 found that without the Terrorism Risk Insurance Act (TRIA) a terrorist attack of the same scale as 9/11 could cost taxpayers as much as $7 billion in uninsured losses. The study’s findings come at a critical time with TRIA set to expire at the end of this year. Apartment owners and developers would significantly benefit from reauthorization because they are required by most lenders to have a policy in place on existing properties and future development projects.
According to Tom LaTourrette, lead author of the study, “If, as many expect, allowing the program to expire causes a sharp decline in the number of businesses with terrorism coverage, we find that the Federal Government could spend billions more in disaster assistance after an attack than it would with the program in place.”
The study is the second in a series of three research studies being issued by RAND this year on TRIA. The first found that TRIA enhances national security by helping ensure that terrorism coverage is available and affordable. The upcoming third study will look into the effect TRIA has on the Workers’ Compensation insurance marketplace.
Meanwhile, as we reported last week a bipartisan group of senators reached consensus on legislation - taking the first step towards reauthorization. The House is also reported to be drafting legislation to reauthorize the program and related action is expected next month.
Date Posted: April 14, 2014