On Thursday, December 19, the Senate passed a 7-year reauthorization of the Terrorism Risk Insurance Program (TRIP, or TRIA) as part of H.R. 1865, a year-end federal spending bill. The program was set to expire at the end of 2020, and is now reauthorized through 2027. The reauthorization language was taken from H.R. 4634 (the Terrorism Risk Insurance Program Reauthorization Act of 2019) which had previously been passed by the House, and its companion bill S. 2877, which was passed out of the Senate Banking Committee earlier this year. It makes no substantive changes to the program, but adds a requirement for a GAO study on cyber-terrorism.
TRIA, which provides a government backstop for insured losses as the result of a terrorist attack, was originally passed in 2002. It has allowed private insurers to keep terrorism coverage affordable and available in the U.S. since its creation. Terrorism insurance is often a necessity for commercial real estate to get financing, and provides stability to the commercial real estate sector and the economy.
NAR has been a strong advocate in Congress for TRIA's long-term, early reauthorization to avoid disruptions to the market. NAR sent a letter of support for the bill to both the House Financial Services Committee and the Senate Banking Committee ahead of their markups, stressing the importance of TRIA to commercial real estate and the economy. NAR is a Steering Committee member of the Coalition to Insure Against Terrorism (CIAT), comprised of industry stakeholders who are committed to ensuring TRIA's reauthorization to keep terrorism insurance available and affordable in the country.