[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 2244 Reported in Senate (RS)]

                                                       Calendar No. 438
113th CONGRESS
  2d Session
                                S. 2244

   To extend the termination date of the Terrorism Insurance Program 
  established under the Terrorism Risk Insurance Act of 2002, and for 
                            other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 10, 2014

 Mr. Schumer (for himself, Mr. Kirk, Mr. Reed, Mr. Heller, Mr. Murphy, 
   Mr. Johanns, Mr. Warner, Mr. Blunt, Mr. Menendez, Mr. Crapo, Mr. 
Johnson of South Dakota, Mrs. Gillibrand, Mr. Isakson, Mr. Tester, Mr. 
 Merkley, Mr. Blumenthal, Mr. Booker, Ms. Mikulski, Mr. Donnelly, Mr. 
 Chambliss, Mr. Markey, Ms. Klobuchar, Mr. Cardin, Mr. Durbin, and Mr. 
   Franken) introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

                             June 23, 2014

        Reported by Mr. Johnson of South Dakota, with amendments
  [Omit the part struck through and insert the part printed in italic]

_______________________________________________________________________

                                 A BILL


 
   To extend the termination date of the Terrorism Insurance Program 
  established under the Terrorism Risk Insurance Act of 2002, and for 
                            other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Terrorism Risk Insurance Program 
Reauthorization Act of 2014''.

SEC. 2. EXTENSION OF TERRORISM INSURANCE PROGRAM.

    Section 108(a) of the Terrorism Risk Insurance Act of 2002 (15 
U.S.C. 6701 note) is amended by striking ``December 31, 2014'' and 
inserting ``December 31, 2021''.

SEC. 3. FEDERAL SHARE.

    Section 103(e)(1)(A) of the Terrorism Risk Insurance Act of 2002 
(15 U.S.C. 6701 note) is amended by inserting ``and beginning 
<DELETED>in the calendar year that follows the date of enactment of the 
Terrorism Risk Insurance Program Reauthorization Act of 2014</DELETED> 
on January 1, 2016, shall decrease by <DELETED>1 percent</DELETED> 1 
percentage point per calendar year until equal to 80 percent'' after 
``85 percent''.

SEC. 4. RECOUPMENT OF FEDERAL SHARE OF COMPENSATION UNDER THE PROGRAM.

    Section 103(e) of the Terrorism Risk Insurance Act of 2002 (15 
U.S.C. 6701 note) is amended--
            (1) in paragraph (6), in the matter preceding subparagraph 
        (A), by striking ``shall be'' and all that follows through 
        subparagraph (E) and inserting <DELETED>``shall be 
        $27,500,000,000 and beginning in the calendar year that follows 
        the date of enactment of the Terrorism Risk Insurance Program 
        Reauthorization Act of 2014 shall increase by $2,000,000,000 
        per calendar year until equal to $37,500,000,000.''; and </DELETED> 
         ``shall be the lesser of--
                    ``(A) $27,500,000,000, as such amount is adjusted 
                pursuant to this paragraph; and
                    ``(B) the aggregate amount, for all insurers, of 
                insured losses during such calendar year,
        provided that beginning in the calendar year that follows the 
        date of enactment of the Terrorism Risk Insurance Program 
        Reauthorization Act of 2014, the amount set forth under 
        subparagraph (A) shall increase by $2,000,000,000 per calendar 
        year until equal to $37,500,000,000.'';
            (2) in paragraph (7)--
                    (A) in subparagraph (A)--
                            (i) in the matter preceding clause (i), by 
                        striking ``for each of the periods referred to 
                        in subparagraphs (A) through (E) of paragraph 
                        <DELETED>6</DELETED> (6)''; and
                            (ii) in clause (i), by striking ``for such 
                        period'';
                <DELETED>    (B) in subparagraph (B)--</DELETED>
                        <DELETED>    (i) by striking ``for any period 
                        referred to in any of subparagraphs (A) through 
                        (E) of paragraph (6)''; and</DELETED>
                        <DELETED>    (ii) by striking ``for such 
                        period'';</DELETED>
                    (B) by striking subparagraph (B) and inserting the 
                following:
                    ``(B) [Reserved.]'';
                <DELETED>    (C) in subparagraph (C), by striking 
                ``occurring during any of the periods referred to in 
                any of subparagraphs (A) through (E) of paragraph 
                (6)''; and</DELETED>
                    (C) in subparagraph (C)--
                            (i) by striking ``occurring during any of 
                        the periods referred to in any of subparagraphs 
                        (A) through (E) of paragraph (6), terrorism 
                        loss risk-spreading premiums in an amount equal 
                        to 133 percent'' and inserting ``, terrorism 
                        loss risk-spreading premiums in an amount equal 
                        to 135.5 percent''; and
                            (ii) by inserting ``as calculated under 
                        subparagraph (A)'' after ``mandatory recoupment 
                        amount''; and
                    (D) in subparagraph (E)(i)--
                            (i) in subclause (I)--
                                    (I) by striking ``2010'' and 
                                inserting ``2017''; and
                                    (II) by striking ``2012'' and 
                                inserting ``2019'';
                            (ii) in subclause (II)--
                                    (I) by striking ``2011'' and 
                                inserting ``2018'';
                                    (II) by striking ``2012'' and 
                                inserting ``2019''; and
                                    (III) by striking ``2017'' and 
                                inserting ``2024''; and
                            (iii) in subclause (III)--
                                    (I) by striking ``2012'' and 
                                inserting ``2019''; and
                                    (II) by striking ``2017'' and 
                                inserting ``2024''.

SEC. 5. TECHNICAL AMENDMENTS.

    The Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is 
amended--
            (1) in section 102--
                    (A) in paragraph (3)--
                            (i) by redesignating subparagraphs (A), 
                        (B), and (C) as clauses (i), (ii), and (iii), 
                        respectively;
                            (ii) in the matter preceding clause (i) (as 
                        so redesignated), by striking ``An entity has'' 
                        and inserting the following:
                    ``(A) In general.--An entity has''; and
                            (iii) by adding at the end the following 
                        new subparagraph:
                    ``(B) Rule of construction.--An entity, including 
                any affiliate thereof, does not have `control' over 
                another entity, if, as of the date of enactment of the 
                Terrorism Risk Insurance Program Reauthorization Act of 
                2014, the entity is acting as an attorney-in-fact, as 
                defined by the Secretary, for the other entity and such 
                other entity is a reciprocal insurer, provided that the 
                entity is not, for reasons other than the attorney-in-
                fact relationship, defined as having `control' under 
                subparagraph (A).'';
                    (<DELETED>A</DELETED>B) in paragraph (7)--
                            (i) by striking subparagraphs (A) through 
                        (F) and inserting the following:
                    ``(A) the value of an insurer's direct earned 
                premiums during the immediately preceding calendar 
                year, multiplied by 20 percent; and'';
                            (ii) by redesignating subparagraph (G) as 
                        subparagraph (B); and
                            (iii) in subparagraph (B), as so 
                        redesignated by clause (ii)--
                                    (I) by striking ``notwithstanding 
                                subparagraphs (A) through (F), for the 
                                Transition Period or any Program Year'' 
                                and inserting ``notwithstanding 
                                subparagraph (A), for any calendar 
                                year''; and
                                    (II) by striking ``Period or 
                                Program Year'' and inserting ``calendar 
                                year'';
                    (<DELETED>B</DELETED>C) by striking paragraph (11); 
                and
                    (<DELETED>C</DELETED>D) by redesignating paragraphs 
                (12) through (16) as paragraphs (11) through (15), 
                respectively; and
            (2) in section 103--
                    (A) in subsection (c), by striking ``Program Year'' 
                and inserting ``calendar year'';
                    (B) in subsection (e)--
                            (i) in paragraph (1)--
                                    (I) in subparagraph (A), as 
                                previously amended by section 3--
                                            (aa) by striking ``the 
                                        Transition Period and each 
                                        Program Year through Program 
                                        Year 4 shall be equal to 90 
                                        percent, and during Program 
                                        Year 5 and each Program Year 
                                        thereafter'' and inserting 
                                        ``each calendar year'';
                                            (bb) by striking the comma 
                                        after ``80 percent''; and
                                            (cc) by striking ``such 
                                        Transition Period or such 
                                        Program Year'' and inserting 
                                        ``such calendar year''; and
                                    (II) in subparagraph (B), by 
                                striking ``exceed'' and all that 
                                follows through clause (ii) and 
                                inserting ``exceed $100,000,000 with 
                                respect to such insured losses 
                                occurring in the calendar year.'';
                            (ii) in paragraph (2)(A), by striking ``the 
                        period beginning on the first day of the 
                        Transition Period and ending on the last day of 
                        Program Year 1, or during any Program Year 
                        thereafter'' and inserting ``a calendar year''; 
                        and
                            (iii) in paragraph (3), by striking ``the 
                        period beginning on the first day of the 
                        Transition Period and ending on the last day of 
                        Program Year 1, or during any other Program 
                        Year'' and inserting ``any calendar year''; and
                    (C) in subsection (g)(2)--
                            (i) by striking ``the Transition Period or 
                        a Program Year'' each place that term appears 
                        and inserting ``the calendar year'';
                            (ii) by striking ``such period'' and 
                        inserting ``the calendar year''; and
                            (iii) by striking ``that period'' and 
                        inserting ``the calendar year''.

SEC. 6. IMPROVING THE CERTIFICATION PROCESS.

    (a) Definitions.--As used in this section--
            (1) the term ``act of terrorism'' has the same meaning as 
        in section 102(1) of the Terrorism Risk Insurance Act of 2002 
        (15 U.S.C. 6701 note);
            (2) the term ``certification process'' means the process by 
        which the Secretary determines whether to certify an act as an 
        act of terrorism under section 102(1) of the Terrorism Risk 
        Insurance Act of 2002 (15 U.S.C. 6701 note); and
            (3) the term ``Secretary'' means the Secretary of the 
        Treasury.
    (b) Study.--Not later than 9 months after the date of enactment of 
this Act, the Secretary shall conduct and complete a study on the 
certification process.
    (c) Required Content.--The study required under subsection (a) 
shall include an examination and analysis of--
            (1) the establishment of a reasonable timeline by which the 
        Secretary must make an accurate determination on whether to 
        certify an act as an act of terrorism;
            (2) the impact that the length of any timeline proposed to 
        be established under paragraph (1) may have on the insurance 
        industry, policyholders, consumers, and taxpayers as a whole;
            (3) the factors the Secretary would evaluate and monitor 
        during the certification process, including the ability of the 
        Secretary to obtain the required information regarding the 
        amount of projected and incurred losses resulting from an act 
        which the Secretary would need in determining whether to 
        certify the act as an act of terrorism;
            (4) the appropriateness, efficiency, and effectiveness of 
        the consultation process required under section 102(1)(A) of 
        the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) 
        and any recommendations on changes to the consultation process; 
        and
            (5) the ability of the Secretary to provide guidance and 
        updates to the public regarding any act that may reasonably be 
        certified as an act of terrorism.
    (d) Report.--Upon completion of the study required under subsection 
(a), the Secretary shall submit a report on the results of such study 
to the Committee on Banking, Housing, and Urban Affairs of the Senate 
and the Committee on Financial Services of the House of 
Representatives.
    (e) Rulemaking.--Section 102(1) of the Terrorism Risk Insurance Act 
of 2002 (15 U.S.C. 6701 note) is amended--
            (1) by redesignating subparagraph (D) as subparagraph (E); 
        and
            (2) by inserting after subparagraph (C) the following:
                    ``(D) Timing of certification.--Not later than 9 
                months after the report required under section 6 of the 
                Terrorism Risk Insurance Program Reauthorization Act of 
                2014 is submitted to the appropriate committees of 
                Congress, the Secretary shall issue final rules 
                governing the certification process, including any 
                timeline applicable to any certification by the 
                Secretary on whether an act is an act of terrorism 
                under this paragraph.''.

SEC. 7. GAO STUDY ON UPFRONT PREMIUMS.

    (a) Study.--Not later than 2 years after the date of enactment of 
this Act, the Comptroller General of the United States shall complete a 
study on the viability and effects of the Federal Government assessing 
and collecting upfront premiums on insurers that participate in the 
Terrorism Insurance Program established under the Terrorism Risk 
Insurance Act of 2002 (15 U.S.C. 6701 note) (hereafter in this section 
referred to as the ``Program'').
    (b) Required Content.--The study required under subsection (a) 
shall examine, but shall not be limited to, the following issues:
            (1) How the Federal Government could determine the price of 
        such upfront premiums on insurers that participate in the 
        Program.
            (2) How the Federal Government could collect and manage 
        such upfront premiums.
            (3) How the Federal Government could ensure that such 
        upfront premiums are not spent for purposes other than claims 
        through the Program.
            (4) How the assessment and collection of such upfront 
        premiums could affect take-up rates for terrorism risk coverage 
        in different regions and industries and how it could impact 
        small businesses and consumers in both metropolitan and non-
        metropolitan areas.
            (5) The effect of collecting such upfront premiums on 
        insurers both large and small.
            (6) The effect of collecting such upfront premiums on the 
        private market for terrorism risk reinsurance.
            (7) The size of any Federal Government subsidy insurers may 
        receive through their participation in the Program, taking into 
        account the Program's current post-event recoupment structure.
    (c) Report.--Upon completion of the study required under subsection 
(a), the Comptroller General shall submit a report on the results of 
such study to the Committee on Banking, Housing, and Urban Affairs of 
the Senate and the Committee on Financial Services of the House of 
Representatives.
    (d) Public Availability.--The study and report required under this 
section shall be made available to the public in electronic form and 
shall be published on the website of the Government Accountability 
Office.
                                                       Calendar No. 438

113th CONGRESS

  2d Session

                                S. 2244

_______________________________________________________________________

                                 A BILL

   To extend the termination date of the Terrorism Insurance Program 
  established under the Terrorism Risk Insurance Act of 2002, and for 
                            other purposes.

_______________________________________________________________________

                             June 23, 2014

                        Reported with amendments