Yesterday, January 12, 2015, President Obama officially signed the legislation needed to reauthorize The Terrorism Reinsurance Act (TRIA). Passage of the bill returns stability to insurers, policyholders and lenders after Congress adjourned and allowed the federal terrorism insurance backstop to expire. The executed legislation does modify terms of the prior act.
The re-authorization (The Terrorism Risk Insurance Program Re-authorization Act of 2015 – H.R. 26) extends the program through 2020 and begins to create a more market-based solution to the terrorism exposure. The TRIA re-authorization gradually increases the trigger to activate the program to $200M (currently $100M) as well as the industry wide retention from $27.5M to $37.5M and begins to decrease the federal reinsurance quota share from 85% to 80%.
Click here for all details of the changes.
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