[Congressional Record Volume 148, Number 79 (Friday, June 14, 2002)]
[Senate]
[Pages S5575-S5577]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                  TERRORISM RISK INSURANCE ACT OF 2002

  The PRESIDING OFFICER. Under the previous order, the Senate will now 
continue consideration of S. 2600, which the clerk will report.

  The legislative clerk read as follows:

       A bill (S. 2600) to ensure the continued financial capacity 
     of insurers to provide coverage for risks from terrorism.


                       vote on amendment no. 3838

  The PRESIDING OFFICER. The question is on agreeing to the amendment 
No. 3838. The yeas and nays have been ordered. The clerk will call the 
roll.
  The legislative clerk called the roll.
  Mr. REID. I announce that the Senator from California (Mrs. Boxer), 
the Senator from North Dakota (Mr. Conrad), the Senator from North 
Dakota (Mr. Dorgan), the Senator from Hawaii (Mr. Inouye), the Senator 
from Vermont (Mr. Jeffords), and the Senator from New Jersey (Mr. 
Torricelli) are necessarily absent.
  I further announce that, if present and voting, the Senator from 
North Dakota (Mr. Conrad) and the Senator from New Jersey (Mr. 
Torricelli) would each vote ``aye.''
  Mr. NICKLES. I announce that the Senator from Colorado (Mr. Allard), 
the Senator from Utah (Mr. Bennett), the Senator from Kansas (Mr. 
Brownback), the Senator from Kentucky (Mr. Bunning), the Senator from 
Montana (Mr. Burns), the Senator from Idaho (Mr. Crapo), the Senator 
from Utah (Mr. Hatch), the Senator from North Carolina (Mr. Helms), the 
Senator from Alaska (Mr. Murkowski), and the Senator from Kansas (Mr. 
Roberts) are necessarily absent.
  I further announce that if present and voting the Senator from 
Kentucky (Mr. Bunning) would vote ``yea.''
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 81, nays 3, as follows:

                      [Rollcall Vote No. 155 Leg.]

                                YEAS--81

     Akaka
     Allen
     Baucus
     Bayh
     Biden
     Bingaman
     Bond
     Breaux
     Byrd
     Campbell
     Cantwell
     Carnahan
     Carper
     Cleland
     Clinton
     Cochran
     Collins
     Corzine
     Craig
     Daschle
     Dayton
     DeWine
     Dodd
     Domenici
     Durbin
     Edwards
     Ensign
     Enzi
     Feingold
     Feinstein
     Fitzgerald
     Frist
     Graham
     Gramm
     Grassley
     Gregg
     Harkin
     Hollings
     Hutchinson
     Hutchison
     Inhofe
     Johnson
     Kennedy
     Kerry
     Kohl
     Kyl
     Landrieu
     Leahy
     Levin
     Lieberman
     Lincoln
     Lott
     McCain
     McConnell
     Mikulski
     Miller
     Murray
     Nelson (FL)
     Nelson (NE)
     Nickles
     Reed
     Reid
     Rockefeller
     Santorum
     Sarbanes
     Schumer
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Snowe
     Specter
     Stabenow
     Stevens
     Thomas
     Thompson
     Thurmond
     Voinovich
     Warner
     Wellstone
     Wyden

                                NAYS--3

     Chafee
     Hagel
     Lugar

                             NOT VOTING--16

     Allard
     Bennett
     Boxer
     Brownback
     Bunning
     Burns
     Conrad
     Crapo
     Dorgan
     Hatch
     Helms
     Inouye
     Jeffords
     Murkowski
     Roberts
     Torricelli
  The amendment (No. 3838) was agreed to.
  Mr. DASCHLE. I move to reconsider the vote.
  Mr. LOTT. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The majority leader.


                             Cloture Motion

  Mr. DASCHLE. Mr. President, a few minutes ago, prior to the vote we 
have just now taken, I asked unanimous consent to set aside the 
Brownback and Ensign amendments, and that was not agreed to. It is now 
my intention to file a cloture motion on the bill, and I ask that the 
cloture motion be read.
  The PRESIDING OFFICER. The cloture motion having been presented under 
rule XXII, the Chair directs the clerk to read the motion.
  The legislative clerk read as follows:

                             Cloture Motion

       We, the undersigned Senators, in accordance with the 
     provisions of rule XXII of the Standing Rules of the Senate, 
     do hereby move to bring to a close the debate on Calendar No. 
     410, S. 2600, the terrorism insurance bill:
         Harry Reid, Hillary Rodham Clinton, Jean Carnahan, 
           Charles Schumer, Kent Conrad, Tom Daschle, Richard 
           Durbin, Jack Reed, Byron L. Dorgan, Christopher J. 
           Dodd, Debbie Stabenow, Jay Rockefeller, Maria Cantwell, 
           Jeff Bingaman, Daniel K. Akaka, Evan Bayh, Joseph 
           Lieberman.

  Mr. DASCHLE. Mr. President, we will announce the time of the cloture 
vote which will, of course, occur on Tuesday morning, but I do hope 
Senators who are interested in the bill at the very least will express 
themselves today and on Monday. We will be in session on Monday.
  I hope we can achieve cloture on the terrorism bill. Of course, that 
is still accommodating Senators who wish to offer amendments for a 30-
hour period following the cloture vote should it be successful.
  Senator Lott and I have just been discussing the schedule for the 
remainder of the week. Once we have completed our work on the terrorism 
insurance bill, it will be my intention to move to the Defense 
authorization bill. I do not think that will take a motion to proceed, 
but certainly one will be offered if it is required. We will be on that 
for the remainder of the week and for whatever length of time it will 
take in the following week.
  Senators should be reminded that we only have 2 weeks to go in this 
work period. We are hopeful we can accommodate a number of nominations 
and a lot of other work besides the Defense authorization bill and the 
terrorism insurance bill. At the very least, we are going to finish 
those two pieces of legislation prior to the time we leave.
  I will announce later today the time for the vote on cloture, but it 
will be Tuesday morning. I urge my colleagues to be present for that 
vote. I yield the floor.
  Mr. LOTT. Mr. President, will the distinguished majority leader 
yield? I want to clarify again that the majority leader does not 
anticipate recorded votes on Monday, even though we will be in session 
for debate and for, I guess, amendments to be offered; is that correct?
  Mr. DASCHLE. The distinguished Republican leader is correct. Earlier 
he may recall that we announced some no-vote Mondays. This particular 
Monday is one of the no-vote Mondays, so-called, so I am going to 
respect that commitment. Senators have made scheduling decisions. 
Certainly we will be in session. As I say, it will be an opportunity 
for people to come to the floor to speak to the bill.
  It is unfortunate we have not been able to get agreement to set the 
amendments aside because I think it would offer other Senators the 
chance to offer additional amendments. Barring that UC, we will expect 
to be in session without the additional consideration of other 
amendments.
  Mr. LOTT. Mr. President, if I can continue, I certainly understand 
and support the decision to identify certain dates for a variety of 
reasons when Senators are aware there will not be votes, but I 
emphasize again, as the majority leader has, it does not mean we cannot 
be in session and get a lot of work done.
  Also, I understand why Senator Daschle feels a necessity to file 
cloture. Obviously, we discourage each other from doing that, but in 
order to move forward after a reasonable period of time--I have done it 
many times on this terrorism insurance issue, while there are some 
other amendments, hopefully germane amendments, that will and can be 
offered and debated and

[[Page S5576]]

considered, in order to get to the Defense authorization bill and 
complete our work before the Fourth of July recess, we need to complete 
this bill in a reasonable period of time--Tuesday or Wednesday--and 
then go right to Defense authorization.
  I commend the Senator for making that decision. There are a lot of 
other bills Senators on both sides are pushing the majority leader to 
do, meritorious or otherwise. This is very important.

  I encourage Senators on both sides of the aisle, when we get to the 
Defense authorization bill, let's not use this as a grab bag. We have 
lots we need to do in this area. We are talking about a pay raise for 
our military men and women. We are talking about quality-of-life 
issues. We are talking about basic decisions about the future of our 
defense for our country. There will be plenty other opportunities to 
offer unrelated, nongermane amendments.
  I believe Senator Warner and Senator Levin will be ready to go. There 
will be disagreements and heated debate on some of the amendments. Some 
will take time. I believe the managers are ready to go and will make 
good progress on it and be assured we can get it done without it being 
very messy.
  I appreciate the decision Senator Daschle has made. I think it is the 
right thing for the Senate, for the military, and for our country.
  The PRESIDING OFFICER. The majority leader.
  Mr. DASCHLE. Mr. President, I thank the Senator as always for his 
cooperation. This is an important schedule. We know we have to finish 
the work on terrorism insurance. We know we have to deal with the 
Defense authorization bill. The Senator from Virginia and the Senator 
from Michigan have been ready to go for a couple of weeks. It should be 
a good debate.
  I also agree with the distinguished Republican leader that this 
should not be the grab bag, this should not be the vehicle that 
attracts extraneous legislation. Let's get it done and done cleanly and 
move on to other matters that are important as well.
  Mr. LOTT. Mr. President, I wish to make one other point, if I can be 
recognized in my own right, before Senator Warner leaves. Senator 
Daschle and I have also been talking about ways to move forward on 
nominations. Hopefully, we are coming up with a process that will allow 
us to make good progress across the board on nominations in the next 
couple of weeks. I am looking forward to continuing work on that also.
  The PRESIDING OFFICER. The Senator from Virginia.
  Mr. WARNER. Mr. President, on behalf of the members of the Armed 
Services Committee, I thank both of our leaders for recognizing the 
need to move to the Defense authorization bill. That hopefully will 
then set the stage for the Defense appropriations bill to follow in an 
orderly manner.
  Just moments ago, the chairman of our committee, the Senator from 
Michigan, Mr. Levin, and I conferred with the leadership. I think I can 
speak on behalf of the chairman that we are both ready to go, and we 
will be prepared to bring up some of the more, should we say, 
controversial amendments early on so that those issues can be addressed 
and hopefully thereafter we can move quickly through the other 
provisions of the bill.
  I thank the Chair, and I thank the leadership.
  I yield the floor.
  Mr. LIEBERMAN. Mr. President, I am a strong supporter of this 
legislation and wish to praise my Connecticut colleague, Senator Dodd, 
for his diligence in crafting a workable solution to the terror 
insurance issue. As we all know, this has been a frustrating process 
and Senator Dodd has proven to be tenacious in the quest to enact this 
legislation into law. He is performing a valuable and mostly unsung 
public service.
  Let me explain why -I believe this issue is so important and why 
Senator Dodd's work is so important.
  As part of their property and casualty insurance, many businesses 
have insurance against the costs that arise if their business is 
interrupted. If we don't pass an effective terror insurance bill, there 
will be a massive interruption in the business community. We can avoid 
this result by passing this legislation.
  Property and casualty insurance is not optional for most businesses. 
Not every business owner buy life insurance, but nearly every business 
buys property and casualty insurance--to protect its property, to 
protect it against liability, and to protect its employees under the 
State workers compensation laws. Property and casualty insurance is 
required by investors and shareholders. It is required by banks that 
lend for construction and other projects.
  We all know that home mortgage companies require the homeowners to 
maintain homeowners property insurance, and it's the same with business 
lending.
  Maintaining property and casualty insurance is mandated as part of 
the fiduciary obligation to the business. And if property and casualty 
insurance for major causes of loss is not available, or it is 
prohibitively expensive, businesses face a difficult choice about going 
forward with construction projects, and other ventures. If no insurance 
is available, banks won't lend and the business activity that is 
depending on the loans will stop. The impact on the real estate, 
energy, construction, and transportation sectors will be severe.
  For their part, insurance companies must be able to ``underwrite'' 
their policies. This means that they need to be able to assess their 
exposure or risk of a claim. They need to know if their exposure to 
claims is acceptable, excessive, or indeterminate. In the case of 
claims for damages caused by terror attacks, there is not way to assess 
their risk and no way to underwrite the policy. There are too many 
uncertainties.
  One thing that is certain, as it was not before September 11, is that 
losses from terrorist acts can cost tens of billions of dollars. In 
fact, under the worst-case scenarios, losses could easily reach 
hundreds of billions of dollars.
  There are hundreds of insurers in any given market. It is a highly 
competitive industry. But these insurers are dependent on reinsurers 
who help insurance companies spread their risk. When reinsurers will 
not renew their contracts unless they contain terrorism exclusions or 
limitations, many if not most of the insurance companies will not be 
able to provide terrorism coverage--at any cost.
  Insurance companies need reinsurance because their own capital to 
cover losses is finite.
  Even a good sized company--one that would be in the top half dozen or 
so commercial insurers in the U.S.--with perhaps 5 percent of the 
commercial lines market and capital of $7 or $8 billion--would have to 
ask, do we want to roll the dice on our very survival by writing 
terrorism coverage and covering it with our own reserves?
  That is not a risk that an insurance company will take. If we do not 
pass this legislation, therefore, insurers will take whatever steps 
they consider necessary to ensure they do not drive themselves into 
bankruptcy.
  The insurance industry can protect itself by reducing its exposure to 
terrorism claims. There is nothing we can do in the Congress--within 
the limits of our Constitution--to require insurance companies to write 
policies. They don't have to write policies. If they don't write 
policies, or write them only with extraordinary premiums for terror 
coverage, the companies may not be as profitable in the short run, but 
they will at least be protecting themselves against involvency.
  State regulators are already considering terrorism exclusions--as 
they should do, consistent with their responsibilities to oversee the 
solvency of the insurance industry. Absent exclusions, in states where 
they might not be approved for one reason or another, the insurers will 
have no choice but to limit their business.
  If insurance companies are permitted to write policies with no 
coverage for claims connected to terrorism, then businesses will have 
to decide if they will self-insure against these losses. Many of them 
will conclude that they cannot accept this exposure.
  Therefore, if we fail to pass this legislation, it will be everyone 
that the insurance companies they insure that loses. Insurance 
companies can protect themselves by not writing policies, or writing 
only policies without any coverage for acts of terror, or writing 
policies with extraordinary premiums. But companies that need insurance 
coverage may have even harsher options.

[[Page S5577]]

  So, the issue is how we enable enough insurance companies to 
determine that the risk of terrorist claims is a risk that they can 
assume.
  That is what this legislation is all about--defining the risk so that 
insurers can assess and put a price on it. This legislation is about 
facilitating insurance companies' ability to continue to write property 
and casualty insurance policies. It is about providing business owners 
with the opportunity to buy insurance against terror claims and doing 
so in the private market to the extent that is possible.
  This is, of course, not the first time we have faced this kind of an 
issue. The Federal Government has a history of partnering with the 
insurance industry to provide coverages for risks that are too big--too 
uninsurable--for the industry alone.
  Current examples are the flood, crop, and nuclear liability programs, 
and in the past we've seen partnerships on vaccine liability and riot 
reinsurance. From an insurability standpoint, these risks are probably 
more insurable than terrorism.
  Some might debate whether we should have passed the existing 
programs, or whether they are operated efficiency. But there should be 
no debate about the need for a terrorism program, and Senator Dodd has 
structured this one the right way--with retentions and loss sharing by 
the industry, so the incentives are there for efficient operations.
  Again, I congratulate my Connecticut colleague, Senator Dodd, for his 
diligence in working through these complicated issues and bringing this 
bill to the floor. We need to defeat the amendments and enact this 
legislation into law as soon as possible.
  The PRESIDING OFFICER. The Senator from West Virginia.
  Mr. ROCKEFELLER. Mr. President, I ask unanimous consent to address 
the Senate as in morning business for 4 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________