Copyright: Orhan Cam
With the opening of the 114th Congress came much welcome relief to apartment owners and managers who rely on terrorism insurance coverage for their properties. This week, the Senate and House overwhelmingly approved the Terrorism Risk Insurance Program Reauthorization Act of 2015 (H.R. 26), which extends the program for six years. President Obama is expected to sign the bill in short order.
Failure to pass legislation during the final days of the 113th Congress caused the program to expire at the end of the year. This forced policyholders to reevaluate their insurance programs and identify alternative coverage options if necessary.
However, the reauthorization did not simply extend the program, it also made some modest changes aimed at increasing taxpayer protections and private market participation. Specifically, it incrementally raises the program trigger to $200 million from $100 million and reduces the federal loss share from 85 to 80 percent. It also increases the level of federal recoupment by $10 billion.
In addition, studies to assess future private market capacity and various program funding options are to be presented to Congress. The compromise package overall represents a win for the policyholder community and ensures continued stability in the real estate market.
NMHC/NAA, along with our partners in the Coalition to Insure Against Terrorism (CIAT), worked tirelessly to advocate for a TRIA reauthorization since early 2013. In addition, our member company representatives contributed to these efforts on the grassroots level with letters, calls and office visits to key lawmakers.
