This analysis supports ABIA's position that the TRIA program needs to be extended because, without the federal backstop, the private insurance market could not provide the necessary coverage. An excerpt from Bloomberg's findings:
- "After 9/11, the supply of terrorism insurance policies virtually disappeared. After TRIA was enacted, commercial take-up rates rose to more than 60 percent in 2012 from 27 percent in 2003. Acts of terrorism remain almost impossible to build into traditional insurer pricing models because they are deliberate and not random events.
- Arguments by some critics of TRIA that the private market is ready and able to step in to fill the void have almost no academic support.
- This analysis concludes that TRIA, like bank deposit insurance, is a government program that addresses a permanent failing of the private market to provide necessary coverage."
If you would like to learn more about ABIA's support of TRIA or help our efforts to ensure TRIA is extended, please contact us to join the ABIA's TRIA Working Group.