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Thursday, July 17, 2014

Senate Passes ABIA-Supported TRIA & NARAB II Legislation

Today the Senate passed ABIA-supported S. 2244, a bipartisan bill to renew the Terrorism Risk Insurance Act, which includes an amendment to create the National Association of Registered Agents and Brokers (NARAB II), by a vote of 93 to 4. ABIA has been a strong industry advocate for both of these programs. Producer licensing reform has been a priority for ABIA since its inception in 2001 and ABIA has supported TRIA since it was first created in 2002.

The bill -- introduced by Sens. Chuck Schumer (D-N.Y.), Dean Heller (R-Nev.), Mark Kirk (R-Ill.), Jack Reed (D-R.I.), Chris Murphy (D-Conn.) and Mike Johanns (R-Neb.) -- would reauthorize TRIA through 2021, increase private insurers’ “co-pay” from 15 to 20 percent and raise the threshold of losses for mandatory federal recoupment of payments to $37.5 billion. Senator Coburn's amendment that would have extended the amount of time the government has to recoup funds from the industry after an attack failed by a vote of 47 to 49.

Sen. Tester (D-MT) offered the ABIA-supported amendment to S. 2244 that establishes the National Association of Registered Agents and Brokers (NARAB), which simplifies the agent licensing process to ensure they can serve clients no matter where they live. The Senate passed this amendment by a voice vote.

The Senate-passed version of NARAB includes a two-year sunset provision that means Congress will have to reauthorize NARAB two years after the first license is issued, which could be about four years from enactment. While not ideal, this provides the industry time to build support for permanent reauthorization.

Leadership in the House has supported debate on the floor of H.R. 4871, the House Financial Security Committee's TRIA bill that has the support of Chairman Hensarling. Moderate republicans and House democrats have voiced objections to this bill and favor the bi-partisan Senate bill. Managing to find majority support for the Hensarling approach to TRIA may take longer than the available time remaining before the House is expected to recess at the end of next week.

However, if the House is able to pass either the House Financial Security Committee's TRIA bill or a compromise bill, it is expected that the committee staff will attempt to harmonize the differences between the Senate and House TRIA versions over the August recess and resubmit the combined TRIA legislation to both Chambers for consideration.

ABA and ABIA issued a statement supporting the Senate's passage of TRIA and NARAB and urging Congress to enact the legislation quickly. Read the statement. 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.