Treasury Seeks Comments on Extending "Make Available" Requirement of Terrorism Risk Insurance Act
The Treasury Department (Treasury) has issued a notice requesting written comments by June 4, 2004 on whether to extend the "make available" requirement of the Terrorism Risk Insurance Act of 2002 (Act) through December 31, 2005.
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The Act requires that each insurer "make available," in all of its property and casualty insurance policies, coverage for insured losses resulting from an act of terrorism as defined by the Act for the period of November 26, 2002 through December 31, 2004. In this regard, the Act requires that such insurance coverage must not differ materially from the terms, amounts and other coverage limitations applicable to losses arising from events other than acts of terrorism.
In addition, the Act requires the Secretary of the Treasury to determine, no later than September 1, 2004, whether to extend these statutory "make available" requirements through December 31, 2005.
(Regardless of whether the "make available" requirements are extended by Treasury through December 31, 2005, Treasury notes that the overall program and the Act's federal backstop for insured losses for acts of terrorism continue through December 31, 2005.)
Comments requested on "make available" effectiveness, etc. Treasury states that it is requesting general comments, as well as comments on certain questions regarding the effectiveness of the "make available" requirement in the context of the overall program; the relationship between the "make available" requirement and the likely capacity of property and casualty insurers to offer coverage for terrorism risk after termination of the program; and operational issues.
(See ITT's Online Archives or 10/22/03 news, 03102299 4, for BP summary of Treasury's final rule which, among other things, incorporated and clarified the "make available" requirements.)
- written comments due by June 4, 2004
Treasury contact - Mario Ugoletti (202) 622-0715
Treasury notice (FR Pub 05/05/04) available at http://a257.g.akamaitech.net/7/257/2422/14mar20010800/edocket.access.gpo.gov/2004/pdf/04-10151.pdf