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Friday, July 11, 2014

Senate Expected to Vote on TRIA & NARAB Next Week

Last night the Senate reached a unanimous consent agreement to move S. 2244, the Terrorism Risk Insurance Act (TRIA) reauthorization bill. We expect the Senate to hold debate and vote on Thursday, July 17th. The legislation is expected to pass the Senate with strong bi-partisan support.

About the Senate Vote
The agreement reached by Senate leadership limits the amendments that can be offered to the four listed below and states that each amendment will have one hour of debate, divided equally between proponents and opponents. In addition, there will be one hour of debate on the bill. After the Senate votes on Tester's NARAB II amendment, the bill will be read again and the Senate will proceed to vote on passage of the bill, as amended.

The agreement reached by Senate leadership limits the amendments that can be offered to:
  • Coburn #3549 would extend the amount of time the government has to recoup funds from the industry after an attack. Likely subject to a roll-call vote.
  • Vitter #3550 would require the Federal Reserve board to include at least one member with a background in community banking. Likely voice vote only.
  • Flake #3551 would create an advisory committee to develop a private reinsurance market. Likely voice vote only.
  • Tester #3552 Would establish NARAB II but with a two-year sunset provision. Likely voice vote only.
About the NARAB II Amendment
Senator Tester will offer the House-passed NARAB II language from H.R. 1155, which includes FBI-supported security measures for background checks. However, the inclusion of the two-year sunset provision means it is not identical to the House-passed bill. That provision states that two years after the first licenses is issued, Congress will need to reauthorize NARAB II. That could be as long as four years after NARAB II is enacted. While not ideal, that gives the industry four years to build support for a permanent reauthorization and, if NARAB II is successful and popular as we believe it will be, Congress is likely to support reauthorization. 

Likely Next Steps
If the Senate vote proceeds as expected and they pass S. 2244 with the House NARAB II language and the two-year sunset provision, then the House will have to decide if it has enough support to pass the Senate's TRIA bill or move forward with the House Financial Security Committee's bill, H.R. 4871. Many Representatives, including Republicans, have voiced support for the Senate's TRIA bill over the House's.

If the House passes the Senate language, then no conference will be needed and TRIA will be reauthorized for 7 years with only limited changes to the program, but NARAB II will be established with the two-year sunset provision, meaning Congress would have to reauthorize it. If the House moves forward with H.R. 4871, then there will be a conference, which would delay final TRIA reauthorization, but might allow the NARAB sunset provision to be removed.

For details on the House and Senate TRIA bills, please refer to the ABIA TRIA matrix. Read the ABIA members-only TRIA matrix. 

Indicates ABIA members-only material. Not an ABIA member? Contact Jennifer Hatten to learn about the benefits of membership and ways to join here. Visit our membership page to learn more.

Are you an ABIA member but not yet on our ABIA Network? Contact Deanne Marino for an invitation.

The ABIA has a Terrorism Insurance TRIA Task Force and a NARAB Task Force. If you would like to learn more about ABIA's support of TRIA and NARAB or join one or both of these Task Forces, please contact us and visit our website.