A memo from Joel Wood, SVP of Government Affairs:
I’m very pleased to announce that a few moments ago, the U.S. Senate overwhelmingly voted to enact a six-year extension of the Terrorism Risk Insurance Act. The act is identical to the legislation approved yesterday by the U.S. House of Representatives. It includes our long-sought NARAB provision to create an interstate agent/broker licensure clearinghouse. The vote was 93 to 4, with only the following senators voting no: Marco Rubio (R-FL), Elizabeth Warren (D-MA), Bernie Sanders (I-VT) and Maria Cantwell (D-WA).
Earlier, an amendment to the act by Sen. Elizabeth Warren (which would have removed a provision affecting the Dodd-Frank Act) was rejected on a 66-31 vote.
There are only a couple of substantial changes in the TRIA program under the legislation. The “trigger” for an act covered under the law will move from $100 million this year, to $200 million in 2020 (graduating $20 million each year). Additionally, the bill also increases insurer co-shares from 15 to 20 percent over the next 5 years.
Linked here is our press statement with additional information. On behalf of our entire team, I cannot express enough gratitude to the House and Senate leadership for propelling this legislation to the finish line in the third day of the new Congress. We likewise are so grateful to all of our members who helped us gather critical data down the stretch about market disruption being caused by the TRIA lapse. A book could be written about the difficulties in achieving this legislation, and most of it wouldn’t be pretty – in fact, emblematic of much of the dysfunction that has characterized Congress in recent years.
On the NARAB front, it’s been a ridiculously long road. Our forerunner organization formed its first task force to deal with the problems of interstate agent/broker licensure in 1933. As our press release notes, the original NARAB provision was something we championed (in a very lonely fashion) in the Dingell insurer solvency legislation in 1992 – legislation that went nowhere. Even with the breakthrough of the enactment of this legislation, the problem won’t be eliminated overnight. It will take some time for the body to be developed and standards set for NARAB membership. But we are confident that this will help.
We have much more work to do on many fronts. Many thanks for everything you do to support our industry and clients.