The U.S. House Financial Services Committee’s Subcommittee on Housing and Insurance held a hearing on the Terrorism Risk Insurance Act of 2002 (TRIA), focusing on how the federal backstop functions and how it interacts with domestic and international terrorism insurance markets. Members highlighted the need to reauthorize TRIA and debated the continued role of the Federal Insurance Office (FIO) in administering the program. Witness testimony outlined TRIA’s operational mechanics, including Treasury certification of an attack with losses above USD 5 million, an aggregate program trigger of USD 200 million, and insurer deductibles equal to 20% of premiums on TRIA-eligible lines, after which Treasury reimburses 80% of losses above the deductible. Testimony also referenced a USD 100 billion cap on insured losses, above which there is no further federal reimbursement and insurers are not responsible to pay losses under existing policies. Industry witnesses described how the September 11 losses and subsequent market tightening contributed to TRIA’s creation and noted that legislative uncertainty ahead of the reauthorization deadline, described as roughly two years away, can affect the availability and terms of terrorism coverage.
U.S. Financial Services Committee 2025-09-17
U.S. House Financial Services Committee holds hearing on reauthorizing the Terrorism Risk Insurance Act and the role of the Federal Insurance Office
The U.S. House Financial Services Committee’s Subcommittee on Housing and Insurance held a hearing on the Terrorism Risk Insurance Act of 2002 (TRIA), discussing its federal backstop and interaction with terrorism insurance markets. Key points included the need for TRIA reauthorization, the Federal Insurance Office's role, and TRIA’s operational mechanics, such as the USD 5 million loss certification, USD 200 million program trigger, and USD 100 billion cap on insured losses. Industry witnesses highlighted the impact of legislative uncertainty on terrorism coverage availability and terms.