At this year’s RMS Terrorism Risk Summit, we focused attention on the U.S. landscape. The main issue these days in terrorism insurance discussions relates to the Terrorism Risk Insurance Protection and Reauthorization Act (TRIPRA), which will expire at the end of December 2020 if not reauthorized. This important legislation is also known by other acronyms including TRIA (Terrorism Risk Insurance Act) and TRIP (Terrorism Risk Insurance Program). In discussing the U.S. federal backstop for certified acts of terrorism, all these names are synonymous.
To help make sense of the speculation and various policy options, RMS was proud to host Scott Williamson, Vice President and Director of Financial Analytics at the Reinsurance Association of America (RAA). Mr. Williamson has developed legislative models to assist the RAA in its advocacy on issues such as TRIA.
At the RMS event, Mr. Williamson provided an overview of the current TRIA structure and explored some alternative modifications to the program that were considered to make a legislative recommendation. This included an evaluation of multiple ‘what-if’ scenarios, using a range of attack modes and targets, and various assumptions regarding the compounded average growth rate of the U.S. economy. For this study, RMS partnered with RAA to estimate economic losses due to a range of scenario terrorism events for property and workers’ compensation lines of businesses, using its latest Terrorism Model and Economic Exposure Data.Continue reading