[Congressional Record Volume 148, Number 48 (Thursday, April 25, 2002)]
[Senate]
[Page S3454]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         TERRORISM REINSURANCE

  Mr. REID. Mr. President, I would like to read into the Record a 
letter that is written to the Honorable Tom Daschle, majority leader of 
the Senate; the Honorable Trent Lott, Republican leader of the Senate; 
the Honorable Dennis Hastert, Speaker of the House of Representatives; 
and the Honorable Richard Gephardt, House Democratic leader. The letter 
is dated April 15 of this year.

       Dear Congressional Leaders: As a result of the event of 
     September 11th, the nation's property and casualty insurance 
     companies have or will pay out losses that will exceed $35 
     billion dollars. Since the first of January, many insurance 
     companies, self-insurers and states have been faced with a 
     situation where they are unable to spread the risk that they 
     insure because of the unavailability of reinsurance 
     protection. In the event of another major attack, some 
     companies or perhaps a segment of the industry would face 
     insolvency. While most states have approved a limited 
     exclusion for terrorism with a $25 million deductible, 
     exclusions for workers' compensation coverage are not 
     permitted by statute in any state. The present situation 
     poses a grave risk to the solvency of the insurance industry, 
     state insurance facilities, economic development initiatives, 
     and the ability of our states to recover from impacts of the 
     September 11th attacks.
       In the months after the attack on our nation, legislation 
     passed in the House and was introduced in the Senate to 
     create a backstop for the insurance industry so they could 
     continue to provide protection to their customers. The 
     Administration has also supported this concept. Currently, 
     there is broad bi-partisan agreement for providing an 
     insurance backstop. Governors believe this is an important 
     goal that should not be inhibited by other issues.
       Since late December, the lack of a financial backstop has 
     started to ripple through the economy and will continue to do 
     so. This will further impact the ability of the economy to 
     recover from the current recession.
       As Governors, we are facing many critical issues resulting 
     from the September 11th crisis. The emerging problem in 
     insurance coverage only serves to exacerbate our recovery 
     efforts. In view of this, we the undersigned Governors, 
     respectfully urge the Congress to quickly complete its work 
     on the terrorism reinsurance legislation in order to return 
     stability to U.S. insurance markets.
           Sincerely,

  The letter is signed by Governor Hodges of the State of South 
Carolina; Governor Johanns of the State of Nebraska; Governor Patton of 
the State of Kentucky; Governor Martz of the State of Montana; Governor 
Siegelman of the State of Alabama; Governor Holden of the State of 
Missouri; Governor Warner of the State of Virginia; Governor McCallum 
of the State of Wisconsin; Governor Owens of the State of Colorado; 
Governor Ryan of the State of Illinois; Governor Geringer of the State 
of Wyoming; Governor Huckabee of the State of Arkansas; Governor King 
of the State of Maine; Governor Rowland of the State of Connecticut; 
Governor Bush of the State of Florida; Governor O'Bannon of the State 
of Indiana; Governor Taft of the State of Ohio; Governor Swift of the 
State of Massachusetts.
  I have been advised that there are many other Governors who would 
have signed this letter. But as with all things, sometimes it is 
difficult to get the signatures from all of those Governors.
  I personally have had many conversations regarding this issue. I have 
had conversations with people in the insurance industry. I have had 
conversations in my office right across the hall with people in the 
real estate business. I have had many conversations with people in the 
financial markets across the country, and people from home, people who 
want to continue one of the largest construction projects we have had 
in Nevada. It would be a huge mall. It is already half completed. It is 
a huge facility that they said they will have to stop construction by 
the first of June if that is not taken care of.
  Senator Dodd has worked incredibly hard to put together a bill that 
resolves this serious problem. The White House wants this bill to get 
to conference with the House, we are told. As I have indicated, these 
Governors, Democratic and Republican, have called for this action. I 
have personally spent a lot of time with the Presiding Officer, junior 
Senator from Florida, who, prior to coming here, was insurance 
commissioner of one of the largest States in the Union, and who has a 
very personal knowledge of the insurance industry. The leader has 
spoken to the Senator from Florida many times more than I have because 
we have looked to him for leadership on this issue.
  I am prepared to move forward with a unanimous consent request 
relating to this issue. I will do so. The only question at this time is 
whether the Republican leader is in the building. I wouldn't want him 
to come from his residence. If he is not here in a reasonable period of 
time, I will be notified by staff. I will at that time make the consent 
request.




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