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 In the aftermath of the war in Iraq, government officials and insurance
industry experts are beginning to focus their attention on the need for global, long-term
solutions to the multitude of insurance problems and risks associated with war and
international terrorism. While the United States has employed a comprehensive range of
legislative, financial and military resources in its ongoing efforts to promote greater
international security and stability, world leaders of government and industry cite the
U.S. Terrorism Risk Insurance Act of 2002 (TRIA) as the insurance industry’s primary
model for future actions and alliances in the postwar marketplace.
Enacted under the auspices of the Department of Homeland Security, TRIA requires all
primary commercial property/casualty companies to offer terrorism coverage to their
policyholders and assures federal financial assistance in case of future terrorist acts.
Heartened by the backstop provisions built into the U.S. government’s legislation,
even those reinsurers who had absorbed the major share of the losses incurred as the
result of the September 11, 2001 terrorist attacks have been re-entering the terrorism
insurance market. In the short term, the availability of affordable coverage has
significantly increased although the demand for terrorism insurance throughout the United
States has been unexpectedly low. However, with TRIA legislation scheduled to expire at
the end of 2005, the international insurance community recognizes the need to develop more
permanent, costeffective and proactive methods of managing future terrorist risks.
In addition to its initiatives in terrorism insurance legislation, the United States
government has also assumed a leadership role in the development of war risk insurance and
other programs to assist in post-war economic recovery efforts – particularly for the
commercial airline and shipping industries. Recent actions undertaken by Congress and
other federal authorities include a permanent war risk insurance program for international
airline service, an extended program for domestic airline service (to run through 2007),
expanded funding for aviation security and safety activities, as well as repairs and
incentives to expedite the loading and shipping of Iraqi oil on U.S.- owned or chartered
tankers and carriers. However, with the world’s most abundant oil and gas reserves
situated in the world’s most politically unstable regions, it is likely that marine
safety and cargo security will continue to demand the attention of the insurance world
long after the American involvement in Iraq has ended.
As peacetime becomes a reality and Americans turn their attention back to domestic
concerns, insurance issues particularly, affordable health care coverage for all Americans
– may become the newest battleground in both the public and private sectors. While an
estimated 41 million Americans have no health insurance coverage at all, insured groups
and individuals already struggling with increased health care costs and cost-sharing
options will continue to be faced with difficult choices in order to maintain adequate and
affordable levels of protection and security for themselves and their families. |
