On July 27, James E. Maurin, chairman of Covington, LA-based Stirling Properties, testified on behalf of the Coalition to Insure Against Terrorism (CIAT) during a hearing of the House Financial Service Committee’s Subcommittee on Capital Markets. Maurin urged lawmakers to consider including a requirement for insurers to make available insurance against the terrorism peril, and secondly, for any terror insurance program to be comprehensive in nature. The latter would require insurers to cover nuclear, chemical, biological, and radiological attacks, as well as domestic acts of terrorism.
During Maurin’s testimony he thanked members of the Subcommittee who had helped develop and enact the Terrorism Risk Insurance Act (TRIA) of 2002. His speech presented a real-world perspective on how the inability to secure terrorism insurance will affect commercial real estate companies in the future and urged committee members to take action. “As policyholders, our members have already been subject to a variety of ‘pop-up exclusions’ and ‘sunset clauses’ and other restrictions, which the insurance industry has begun to impose on renewal of policies running through Dec. 31, 2005. These exclusions are in anticipation of a possible disappearance of the TRIA backstop,” he said. “These gaps, or potential gaps, in coverage will begin to have an effect on the construction lending and debt ratings the [later we go this year] without a replacement program being in place.”
Maurin and the rest of the business insurance policyholders throughout the construction, entertainment, manufacturing, real estate, retailing, and transportation sectors represented by CIAT are urging immediate action, especially as the expiration of TRIA on Dec. 31, draws near.
To read Maurin’s complete testimony, visit (www.insureagainstterrorism.org/testimony72005.pdf).