U.S. Chamber of Commerce
Terrorism Risk Protection Act.
At the urging of a U.S. Chamber-led coalition, the House passed the Terrorism Risk Protection Act. This legislation would establish a temporary, appropriate federal financial backstop to ensure coverage of terrorism claims and clarify liability stemming from terrorist acts. Unfortunately, the Senate did not consider terrorism insurance legislation during the 2001 session. Aside from the enormous loss of life, the September 11, 2001 terrorist attack on the World Trade Center and the Pentagon was the largest single-day insured loss in U.S. history. The insurance industry is responsible for more than $50 billion in claims--far surpassing the previous record of $30 billion resulting from the destruction wreaked by Hurricane Andrew in 1992.
In the wake of these massive, unforeseeable claims, insurers and re-insurers have been compelled to drastically reduce or completely eliminate terrorism coverage, especially for potential terrorist targets that include office towers, transportation hubs, sports arenas, and aviation facilities. As a result, a majority of U.S. businesses have been left without terrorism insurance. The terrorist attacks have also raised new concerns about business liability and corporate responsibility for future attacks. In particular, there are concerns that a small group of plaintiffs' attorneys could attempt to sue companies victimized by terrorism, such as airlines, to exploit the legal system and direct blame for terrorist acts.