Willis supports permanent government terrorism insurance backstop

Willis North America has urged the United States government to renew the Terrorism Risk Insurance Act (TRIA), due to expire at the end of 2007, and establish a permanent government terrorism insurance backstop.Don Bailey, CEO of Willis North America, a subsidiary of Willis Group Holdings, told the U.S. Congress recently that the federal program has stabilized the market and made affordable terrorism coverage available to businesses across the country and in most major industrial sectors.Testifying before the Senate Banking Committee on behalf of both Willis and The Council of Insurance Agents & Brokers, Bailey said TRIA has been an unqualified success, and allowing it to expire at the end of this year would be “economically devastating.””The most important issue for the broker community is maintaining access to [terrorism] coverage at a price the business consumer can afford,” Bailey said. “In order to get this access, we need insurers who are able and willing to provide the coverage.It is clear that they cannot and will not be able to provide terror coverage without a federal backstop or some other mechanism to cap their exposure.”Bailey recommended adding risks posed by nuclear, biological, chemical or radiation (NBCR) to the federal backstop program.”Extending the life of TRIA, expanding the program to better encompass NBCR exposures and readjusting its terms to address the changed parameters will keep terrorism coverage available and the market and economy stable,” Bailey said.