[House Report 119-561]
[From the U.S. Government Publishing Office]


119th Congress }                                              { Report
                        HOUSE OF REPRESENTATIVES
  2d Session   }                                              { 119-561

=======================================================================



 
                TRIA PROGRAM REAUTHORIZATION ACT OF 2026

                            ----------------
                                
 March 19, 2026.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                            ----------------
                                
    Mr. Hill of Arkansas, from the Committee on Financial Services, 
                        submitted the following


                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 7128]

    The Committee on Financial Services, to whom was referred 
the bill (H.R. 7128) to extend the Terrorism Risk Insurance 
Program, and for other purposes, having considered the same, 
reports favorably thereon with an amendment and recommends that 
the bill as amended do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     2
Background and Need for Legislation..............................     3
Committee Consideration..........................................     3
Related Hearings.................................................     4
Committee Votes..................................................     4
Committee Oversight Findings.....................................    10
Performance Goals and Objectives.................................    10
Committee Cost Estimate..........................................    10
New Budget Authority and CBO Cost Estimate.......................    10
Unfunded Mandates Statement......................................    10
Earmark Statement................................................    10
Federal Advisory Committee Act Statement.........................    11
Applicability to the Legislative Branch..........................    11
Duplication of Federal Programs..................................    11
Section-by-Section Analysis of the Legislation...................    11
Changes in Existing Law Made by the Bill, as Reported............    11
Documents Included by Unanimous Consent..........................    26
Dissenting Views.................................................    41

    The amendment is as follows:
    Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``TRIA Program Reauthorization Act of 
2026''.

SEC. 2. EXTENSION.

  Section 108(a) of the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 
6701 note) is amended by striking ``2027'' and inserting ``2034''.

SEC. 3. IMPROVEMENTS TO CERTIFICATION PROCESS.

  Section 102(1) of the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 
6701 note) is amended--
          (1) in subparagraph (B)--
                  (A) in clause (i), by striking ``or'' at the end;
                  (B) in clause (ii), by striking ``exceed 
                $5,000,000.'' and inserting: ``exceed--
                                  ``(I) with respect to an act that 
                                occurred in a year before 2029, 
                                $5,000,000; and
                                  ``(II) with respect to an act that 
                                occurred in 2029, or any year 
                                thereafter, $10,000,000; or''; and
                  (C) by adding at the end the following:
                          ``(iii) the Secretary did not certify such 
                        act as an act of terrorism before the 
                        expiration of the 90-day period following the 
                        publication of a notice in the Federal Register 
                        under subparagraph (D)(i).''; and
          (2) by striking subparagraph (D) and inserting the following:
                  ``(D) Notice requirements.--
                          ``(i) In general.--The Secretary shall, not 
                        later than 30 days after beginning the process 
                        of determining whether to certify an act as an 
                        act of terrorism, publish a notice in the 
                        Federal Register that informs the public that 
                        the Secretary is in the process of determining 
                        whether to certify the act as an act of 
                        terrorism.
                          ``(ii) Additional notice permitted.--The 
                        Secretary may, as the Secretary determines 
                        appropriate, notify the public, through 
                        publication in the Federal Register, or 
                        otherwise, that an act is not being evaluated 
                        by the Secretary to determine whether it should 
                        be certified as an act of terrorism.''.

SEC. 4. TECHNICAL AMENDMENTS.

  (a) In General.--Section 103(e)(7)(E)(i) of the Terrorism Risk 
Insurance Act of 2002 (15 U.S.C. 6701 note) is amended--
          (1) in subclause (I)--
                  (A) by striking ``2022'' and inserting ``2029''; and
                  (B) by striking ``2024'' and inserting ``2031'';
          (2) in subclause (II)--
                  (A) by striking ``2023'' and inserting ``2030'';
                  (B) by striking ``2029'' and inserting ``2036''; and
                  (C) by striking ``2024'' and inserting ``2031''; and
          (3) in subclause (III)--
                  (A) by striking ``2029'' and inserting ``2036''; and
                  (B) by striking ``2024'' and inserting ``2031''.
  (b) Technical Correction.--The Terrorism Risk Insurance Act of 2002 
(15 U.S.C. 6701 note) is amended by striking ``Terrorism Insurance 
Program'' each place it appears in text and headings and inserting 
``Terrorism Risk Insurance Program''.

                          Purpose and Summary

    H.R. 7128, the TRIA Program Reauthorization Act of 2026, 
was introduced on January 16, 2026, by Republican 
Representative Mike Flood (NE-01). This bill amends the 
Terrorism Risk Insurance Act of 2002 to extend Treasury's 
Terrorism Insurance Program for an additional seven years 
through the end of 2034. The bill also increases the minimum 
threshold for certification of an act of terrorism to $10 
million from $5 million beginning in 2029. Additionally, the 
bill codifies an existing regulation for Treasury to provide a 
public disclosure in the Federal Register within 30 days of 
commencing the process to determine if an act can be certified 
under the program, as well as requires Treasury to issue any 
certification final determination within 90 days of that 
notice.

                  Background and Need for Legislation

    In the aftermath of the September 11 terrorist attacks, 
which resulted in approximately $45 billion in insured losses, 
insurers and reinsurers recognized that they lacked the data 
necessary to reliably model or price terrorism risk. In 
response, many substantially increased premiums for terrorism 
coverage or excluded it altogether. The widespread use of 
costly standalone terrorism policies disrupted insurance 
markets, particularly for new construction projects and 
employers with large, centralized workforces in higher-risk 
locations such as New York City, Atlanta, and San Francisco.
    To address the market demand, Congress enacted the 
Terrorism Risk Insurance Act (TRIA) in 2002 as a temporary 
federal backstop to stabilize pricing and restore market 
capacity while the private sector rebuilt capital and improved 
terrorism risk modeling. Since enactment, Congress has 
periodically reauthorized the program (in 2005, 2007, 2015, and 
2019) in recognition that terrorism risk remains difficult to 
predict, highly correlated, and potentially catastrophic in 
ways that challenge purely private insurance solutions. As a 
result, TRIA has remained an important stabilizing mechanism 
that supports the availability of terrorism risk insurance 
across key sectors of the economy. It is important to note that 
uncertainty surrounding the program's future can lead to higher 
premiums, reduced coverage availability, or delayed investment 
decisions long before an actual lapse occurs. This legislation 
addresses that risk by extending TRIA for seven years providing 
much needed certainty for insurers and policyholders alike.
    The bill increases the program's qualifying loss threshold 
from $5 million to $10 million beginning in 2029 providing 
certainty to policyholders regarding the payment of future 
claims and ensuring the federal backstop applies only to truly 
noteworthy events. It also benefits policyholders through 
codification of the regulatory requirement that Treasury 
provide public notice whenever it begins considering whether to 
certify an act under TRIA as well as establishing a 90-day 
deadline from that notice for Treasury to issue any final 
certification determination. Both changes would increase 
program transparency and eliminate harmful delays that prevent 
policyholders from having their insurance claims paid.

                        Committee Consideration

                             119TH CONGRESS

    On January 16, 2026, Representative Flood introduced H.R. 
7128, the TRIA Program Reauthorization Act of 2026, with 
Representative Andrew Garbarino (R-NY) as original cosponsor. 
Representatives Emanuel Cleaver (D-MO), Nydia Velazquez (D-NY), 
and Ayanna Pressley (D-MA) were added subsequently as 
cosponsors.
    The bill was referred solely to the Committee on Financial 
Services. A discussion draft version of the bill was attached 
to the September 17, 2025, hearing titled ``The Reauthorization 
of the Terrorism Risk Insurance Act of 2002.''
    On January 22, 2026, the Committee on Financial Services 
met in open session to consider, among others, H.R. 7128. The 
Committee ordered H.R. 7128, as amended, to be reported with a 
favorable recommendation to the House of Representatives.

                            Related Hearings

    Pursuant to clause 3(c)(6) of rule XIII of the Rules of the 
House of Representatives, the following hearing was used to 
develop H.R. 7128:
    On September 17, 2025, the Subcommittee on Housing and 
Insurance held a hearing titled, ``The Reauthorization of the 
Terrorism Risk Insurance Act of 2002.'' The Subcommittee heard 
testimony from: Mr. Baird Webel, Specialist in Financial 
Economics, Congressional Research Service; Mrs. Elizabeth Heck, 
Chairman, President, and CEO, Greater New York Insurance 
Companies, on behalf of the National Association of Mutual 
Insurance Companies; Ms. Michelle Sartain, President, Marsh 
U.S. and Canada; Mr. Jason Schupp, Founder and Managing Member, 
Centers of Better Insurance, LLC; and Commissioner Andrew N. 
Mais, Connecticut Insurance Department, on behalf of the 
National Association of Insurance Commissioners.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee Report to include record 
votes on the motion to report legislation and amendments 
thereto.
    On January 22, 2026, the Committee ordered H.R. 7128, as 
amended, to be reported with a favorable recommendation to the 
House by a recorded vote of 51 yeas and 2 nays, a quorum being 
present. (Record Vote No. FC-234).
    The Committee considered the following amendments to H.R. 
7128:
           Representative Flood offered an amendment in 
        the nature of a substitute, which changes the proposed 
        minimum threshold for certification of an act of 
        terrorism from $25 million to $10 million, and made 
        minor edits and technical changes. This amendment was 
        adopted by a voice vote.
           Representative John Rose (R-TN) offered an 
        amendment (No. 1), designated ROSETN_045. This 
        amendment shortens the reauthorization of the Terrorism 
        Risk Insurance Act from seven years to five years, 
        decreases the federal cost share to 70 percent, 
        increases the program trigger to $250 million, and 
        requires a study on charging insurers an annual 
        participation fee. This amendment failed by a recorded 
        vote of 2 yeas and 49 nays, a quorum being present. 
        (Record Vote No. FC-231).
           Representative Sylvia Garcia (D-TX) offered 
        an amendment (No. 2), designated TRIA_AMEND_1. This 
        amendment requires the Treasury Secretary to cover 
        costs of damages incurred by a U.S. citizen as a result 
        of actions taken by U.S. Immigration and Customs 
        Enforcement, if a court determines such actions 
        violated the law. This amendment failed by a recorded 
        vote of 18 yeas and 34 nays, a quorum being present. 
        (Record Vote No. FC-232).
           Ranking Member Waters offered an amendment 
        (No. 3), designated TRIA_AMEND_2. This amendment 
        requires the Treasury Secretary to cover the costs of 
        damages incurred by a U.S. citizen as a result of the 
        invocation of the Insurrection Act by the President. 
        This amendment failed by a recorded vote of 18 yeas and 
        34 nays, a quorum being present. (Record Vote No. FC-
        233). 
        
        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 
        
        
                      Committee Oversight Findings

    Pursuant to clause 3(c) of rule XIII of the Rules of the 
House of Representatives, the findings and recommendations of 
the Committee, based on oversight activities under clause 
2(b)(1) of rule X of the Rules of the House of Representatives 
are incorporated in the descriptive portions of this report.

                    Performance Goals and Objectives

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, the goal of H.R. 7128 is to extend 
and improve the government's private-sector insured terrorism 
loss risk sharing plan created by the Terrorism Risk Insurance 
Act of 2002.

                        Committee Cost Estimate

    Clause 3(d)(1) of rule XIII of the Rules of the House of 
Representatives requires an estimate and a comparison of the 
costs that would be incurred in carrying out H.R. 7128. The 
Committee has requested but not received a cost estimate from 
the Director of the Congressional Budget Office. However, 
pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee will adopt as its own 
the cost estimate by the Director of the Congressional Budget 
Office once it has been prepared.

               New Budget Authority and CBO Cost Estimate

    With respect to the requirements of clause 3(c)(2) of rule 
XIII of the Rules of the House of Representatives and section 
308(a) of the Congressional Budget Act of 1974 and with respect 
to requirements of clause 3(c)(3) of rule XIII of the Rules of 
the House of Representatives and section 402 of the 
Congressional Budget Act of 1974, the Committee will adopt as 
its own the cost estimate for the bill prepared by the Director 
of the Congressional Budget Office. However, a cost estimate 
was not made available to the Committee in time for the filing 
of this report. The Chairman of the Committee shall cause such 
estimate to be printed in the Congressional Record upon its 
receipt by the Committee.

                      Unfunded Mandates Statement

    The Committee has requested but not received from the 
Director of the Congressional Budget Office an estimate of the 
Federal mandates pursuant to section 423 of the Unfunded 
Mandates Reform Act. The Chairman of the Committee shall cause 
such estimate to be printed in the Congressional Record upon 
its receipt by the Committee.

                           Earmark Statement

    In compliance with clause 9 of rule XXI of the Rules of the 
House of Representatives, this bill, as reported, contains no 
congressional earmarks, limited tax benefits, or limited tariff 
benefits as defined in clause 9(e), 9(f), or 9(g) of rule XXI.

                Federal Advisory Committee Act Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                Applicability to the Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

                    Duplication of Federal Programs

    Pursuant to clause 3(c)(5) of rule XIII of the Rules of the 
House of Representatives, the Committee states that no 
provision of the bill establishes or reauthorizes a program of 
the Federal Government known to be duplicative of another 
Federal program, including any program that was included in a 
report to Congress pursuant to section 21 of the Public Law 
111-139 or the most recent Catalog of Federal Domestic 
Assistance.

             Section-by-Section Analysis of the Legislation

Section 1. Short title

    Section 1 provides the short title is the ``TRIA Program 
Reauthorization Act of 2026''.

Section 2. Extension

    Section 2 extends the authorization period for the program 
from 2027 through the end of 2034.

Section 3. Improvements to certification process

    Section 3 increases the minimum threshold for certification 
of an act of terrorism from $5 million to $10 million in 2029. 
It also codifies the existing regulation that the Secretary 
shall, not later than 30 days after beginning the process of 
determining whether to certify an act as an act of terrorism, 
publish a notice in the Federal Register that informs the 
public such a process has begun. Additionally, it requires that 
any final decision to certify an act must be made within 90 
days of that public notice.

Section 4 Technical amendments

    Section 4 updates the dates for the timing of mandatory 
recoupment that, if the Secretary is required to collect 
terrorism loss risk-spreading premiums under the Act, by which 
such payments must be received. It also adjusts previous 
references in statute to the ``Terrorism Insurance Program'' to 
correctly read as the ``Terrorism Risk Insurance Program.''

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, and existing law in which no 
change is proposed is shown in roman):

                  TERRORISM RISK INSURANCE ACT OF 2002

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``Terrorism 
Risk Insurance Act of 2002''.
  (b) Table of Contents.--The table of contents for this Act is 
as follows:

Sec. 1. Short title; table of contents.

         TITLE I--[TERRORISM INSURANCE PROGRAM] TERRORISM RISK  
                           INSURANCE PROGRAM

           *       *       *       *       *       *       *
Sec. 103. [Terrorism Insurance Program] Terrorism Risk Insurance 
          Program.
           *       *       *       *       *       *       *

         TITLE I--[TERRORISM INSURANCE PROGRAM] TERRORISM RISK
                           INSURANCE PROGRAM

           *       *       *       *       *       *       *

SEC. 102. DEFINITIONS.

   In this title, the following definitions shall apply:
          (1) Act of terrorism.--
                  (A) Certification.--The term ``act of 
                terrorism'' means any act that is certified by 
                the Secretary, in consultation with the 
                Secretary of Homeland Security, and the 
                Attorney General of the United States--
                          (i) to be an act of terrorism;
                          (ii) to be a violent act or an act 
                        that is dangerous to--
                                  (I) human life;
                                  (II) property; or
                                  (III) infrastructure;
                          (iii) to have resulted in damage 
                        within the United States, or outside of 
                        the United States in the case of--
                                  (I) an air carrier or vessel 
                                described in paragraph (5)(B); 
                                or
                                  (II) the premises of a United 
                                States mission; and
                          (iv) to have been committed by an 
                        individual or individuals, as part of 
                        an effort to coerce the civilian 
                        population of the United States or to 
                        influence the policy or affect the 
                        conduct of the United States Government 
                        by coercion.
                  (B) Limitation.--No act shall be certified by 
                the Secretary as an act of terrorism if--
                          (i) the act is committed as part of 
                        the course of a war declared by the 
                        Congress, except that this clause shall 
                        not apply with respect to any coverage 
                        for workers' compensation; [or]
                          (ii) property and casualty insurance 
                        losses resulting from the act, in the 
                        aggregate, do not [exceed $5,000,000.] 
                        exceed--
                                  (I) with respect to an act 
                                that occurred in a year before 
                                2029, $5,000,000; and 
                                  (II) with respect to an act 
                                that occurred in 2029, or any 
                                year thereafter, $10,000,000; 
                                or 
                          (iii) the Secretary did not certify 
                        such act as an act of terrorism before 
                        the expiration of the 90-day period 
                        following the publication of a notice 
                        in the Federal Register under 
                        subparagraph (D)(i).
                  (C) Determinations final.--Any certification 
                of, or determination not to certify, an act as 
                an act of terrorism under this paragraph shall 
                be final, and shall not be subject to judicial 
                review.
                  [(D) Timing of certification.--Not later than 
                9 months after the report required under 
                section 107 of the Terrorism Risk Insurance 
                Program Reauthorization Act of 2015 is 
                submitted to the appropriate committees of 
                Congress, the Secretary shall issue final rules 
                governing the certification process, including 
                establishing a timeline for which an act is 
                eligible for certification by the Secretary on 
                whether an act is an act of terrorism under 
                this paragraph.]
                  (D) Notice requirements.--
                          (i) In general.--The Secretary shall, 
                        not later than 30 days after beginning 
                        the process of determining whether to 
                        certify an act as an act of terrorism, 
                        publish a notice in the Federal 
                        Register that informs the public that 
                        the Secretary is in the process of 
                        determining whether to certify the act 
                        as an act of terrorism.
                          (ii) Additional notice permitted.--
                        The Secretary may, as the Secretary 
                        determines appropriate, notify the 
                        public, through publication in the 
                        Federal Register, or otherwise, that an 
                        act is not being evaluated by the 
                        Secretary to determine whether it 
                        should be certified as an act of 
                        terrorism.
                  (E) Nondelegation.--The Secretary may not 
                delegate or designate to any other officer, 
                employee, or person, any determination under 
                this paragraph of whether, during the effective 
                period of the Program, an act of terrorism has 
                occurred.
          (2) Affiliate.--The term ``affiliate'' means, with 
        respect to an insurer, any entity that controls, is 
        controlled by, or is under common control with the 
        insurer.
          (3) Control.--
                  (A) In general.--An entity has ``control'' 
                over another entity, if--
                          (i) the entity directly or indirectly 
                        or acting through 1 or more other 
                        persons owns, controls, or has power to 
                        vote 25 percent or more of any class of 
                        voting securities of the other entity;
                          (ii) the entity controls in any 
                        manner the election of a majority of 
                        the directors or trustees of the other 
                        entity; or
                          (iii) the Secretary determines, after 
                        notice and opportunity for hearing, 
                        that the entity directly or indirectly 
                        exercises a controlling influence over 
                        the management or policies of the other 
                        entity.
                  (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 2015, 
                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).
          (4) Direct earned premium.--The term ``direct earned 
        premium'' means a direct earned premium for property 
        and casualty insurance issued by any insurer for 
        insurance against losses occurring at the locations 
        described in subparagraphs (A) and (B) of paragraph 
        (5).
          (5) Insured loss.--The term ``insured loss'' means 
        any loss resulting from an act of terrorism (including 
        an act of war, in the case of workers' compensation) 
        that is covered by primary or excess property and 
        casualty insurance issued by an insurer if such loss--
                  (A) occurs within the United States; or
                  (B) occurs to an air carrier (as defined in 
                section 40102 of title 49, United States Code), 
                to a United States flag vessel (or a vessel 
                based principally in the United States, on 
                which United States income tax is paid and 
                whose insurance coverage is subject to 
                regulation in the United States), regardless of 
                where the loss occurs, or at the premises of 
                any United States mission.
          (6) Insurer.--The term ``insurer'' means any entity, 
        including any affiliate thereof--
                  (A) that is--
                          (i) licensed or admitted to engage in 
                        the business of providing primary or 
                        excess insurance in any State;
                          (ii) not licensed or admitted as 
                        described in clause (i), if it is an 
                        eligible surplus line carrier listed on 
                        the Quarterly Listing of Alien Insurers 
                        of the NAIC, or any successor thereto;
                          (iii) approved for the purpose of 
                        offering property and casualty 
                        insurance by a Federal agency in 
                        connection with maritime, energy, or 
                        aviation activity;
                          (iv) a State residual market 
                        insurance entity or State workers' 
                        compensation fund; or
                          (v) any other entity described in 
                        section 103(f), to the extent provided 
                        in the rules of the Secretary issued 
                        under section 103(f);
                  (B) that receives direct earned premiums for 
                any type of commercial property and casualty 
                insurance coverage, other than in the case of 
                entities described in sections 103(d) and 
                103(f); and
                  (C) that meets any other criteria that the 
                Secretary may reasonably prescribe.
          (7) Insurer deductible.--The term ``insurer 
        deductible'' means--
                  (A) the value of an insurer's direct earned 
                premiums during the immediately preceding 
                calendar year, multiplied by 20 percent; and
                  (B) notwithstanding subparagraph (A), for any 
                calendar year, if an insurer has not had a full 
                year of operations during the calendar year 
                immediately preceding such calendar year, such 
                portion of the direct earned premiums of the 
                insurer as the Secretary determines 
                appropriate, subject to appropriate 
                methodologies established by the Secretary for 
                measuring such direct earned premiums.
          (8) NAIC.--The term ``NAIC'' means the National 
        Association of Insurance Commissioners.
          (9) Person.--The term ``person'' means any 
        individual, business or nonprofit entity (including 
        those organized in the form of a partnership, limited 
        liability company, corporation, or association), trust 
        or estate, or a State or political subdivision of a 
        State or other governmental unit.
          (10) Program.--The term ``Program'' means the 
        [Terrorism Insurance Program] Terrorism Risk Insurance 
        Program established by this title.
          (11) Property and casualty insurance.--The term 
        ``property and casualty insurance''--
                  (A) means commercial lines of property and 
                casualty insurance, including excess insurance, 
                workers' compensation insurance, and directors 
                and officers liability insurance; and
                  (B) does not include--
                          (i) Federal crop insurance issued or 
                        reinsured under the Federal Crop 
                        Insurance Act (7 U.S.C. 1501 et seq.), 
                        or any other type of crop or livestock 
                        insurance that is privately issued or 
                        reinsured;
                          (ii) private mortgage insurance (as 
                        that term is defined in section 2 of 
                        the Homeowners Protection Act of 1998 
                        (12 U.S.C. 4901)) or title insurance;
                          (iii) financial guaranty insurance 
                        issued by monoline financial guaranty 
                        insurance corporations;
                          (iv) insurance for medical 
                        malpractice;
                          (v) health or life insurance, 
                        including group life insurance;
                          (vi) flood insurance provided under 
                        the National Flood Insurance Act of 
                        1968 (42 U.S.C. 4001 et seq.);
                          (vii) reinsurance or retrocessional 
                        reinsurance;
                          (viii) commercial automobile 
                        insurance;
                          (ix) burglary and theft insurance;
                          (x) surety insurance;
                          (xi) professional liability 
                        insurance; or
                          (xii) farm owners multiple peril 
                        insurance.
          (12) Secretary.--The term ``Secretary'' means the 
        Secretary of the Treasury.
          (13) State.--The term ``State'' means any State of 
        the United States, the District of Columbia, the 
        Commonwealth of Puerto Rico, the Commonwealth of the 
        Northern Mariana Islands, American Samoa, Guam, each of 
        the United States Virgin Islands, and any territory or 
        possession of the United States.
          (14) United states.--The term ``United States'' means 
        the several States, and includes the territorial sea 
        and the continental shelf of the United States, as 
        those terms are defined in the Violent Crime Control 
        and Law Enforcement Act of 1994 (18 U.S.C. 2280, 2281).
          (15) Rule of construction for dates.--With respect to 
        any reference to a date in this title, such day shall 
        be construed--
                  (A) to begin at 12:01 a.m. on that date; and
                  (B) to end at midnight on that date.

SEC. 103. [TERRORISM INSURANCE PROGRAM]  TERRORISM RISK INSURANCE 
             PROGRAM.

  (a) Establishment of Program.--
          (1) In general.--There is established in the 
        Department of the Treasury the [Terrorism Insurance 
        Program] Terrorism Risk Insurance Program.
          (2) Authority of the secretary.--Notwithstanding any 
        other provision of State or Federal law, the Secretary 
        shall administer the Program, and shall pay the Federal 
        share of compensation for insured losses in accordance 
        with subsection (e).
          (3) Mandatory participation.--Each entity that meets 
        the definition of an insurer under this title shall 
        participate in the Program.
  (b) Conditions for Federal Payments.--No payment may be made 
by the Secretary under this section with respect to an insured 
loss that is covered by an insurer, unless--
          (1) the person that suffers the insured loss, or a 
        person acting on behalf of that person, files a claim 
        with the insurer;
          (2) the insurer provides clear and conspicuous 
        disclosure to the policyholder of the premium charged 
        for insured losses covered by the Program and the 
        Federal share of compensation for insured losses under 
        the Program--
                  (A) in the case of any policy that is issued 
                before the date of enactment of this Act, not 
                later than 90 days after that date of 
                enactment;
                  (B) in the case of any policy that is issued 
                within 90 days of the date of enactment of this 
                Act, at the time of offer and renewal of the 
                policy; and
                  (C) in the case of any policy that is issued 
                more than 90 days after the date of enactment 
                of this Act, on a separate line item in the 
                policy, at the time of offer and renewal of the 
                policy;
          (3) in the case of any policy that is issued after 
        the date of enactment of the Terrorism Risk Insurance 
        Program Reauthorization Act of 2007, the insurer 
        provides clear and conspicuous disclosure to the 
        policyholder of the existence of the $100,000,000,000 
        cap under subsection (e)(2), at the time of offer, 
        purchase, and renewal of the policy;
          (4) the insurer processes the claim for the insured 
        loss in accordance with appropriate business practices, 
        and any reasonable procedures that the Secretary may 
        prescribe; and
          (5) the insurer submits to the Secretary, in 
        accordance with such reasonable procedures as the 
        Secretary may establish--
                  (A) a claim for payment of the Federal share 
                of compensation for insured losses under the 
                Program;
                  (B) written certification--
                          (i) of the underlying claim; and
                          (ii) of all payments made for insured 
                        losses; and
                  (C) certification of its compliance with the 
                provisions of this subsection.
  (c) Mandatory Availability.--During each calendar year, each 
entity that meets the definition of an insurer under section 
102--
          (1) shall make available, in all of its property and 
        casualty insurance policies, coverage for insured 
        losses; and
          (2) shall make available property and casualty 
        insurance coverage for insured losses that does not 
        differ materially from the terms, amounts, and other 
        coverage limitations applicable to losses arising from 
        events other than acts of terrorism.
  (d) State Residual Market Insurance Entities.--
          (1) In general.--The Secretary shall issue 
        regulations, as soon as practicable after the date of 
        enactment of this Act, that apply the provisions of 
        this title to State residual market insurance entities 
        and State workers' compensation funds.
          (2) Treatment of certain entities.--For purposes of 
        the regulations issued pursuant to paragraph (1)--
                  (A) a State residual market insurance entity 
                that does not share its profits and losses with 
                private sector insurers shall be treated as a 
                separate insurer; and
                  (B) a State residual market insurance entity 
                that shares its profits and losses with private 
                sector insurers shall not be treated as a 
                separate insurer, and shall report to each 
                private sector insurance participant its share 
                of the insured losses of the entity, which 
                shall be included in each private sector 
                insurer's insured losses.
          (3) Treatment of participation in certain entities.--
        Any insurer that participates in sharing profits and 
        losses of a State residual market insurance entity 
        shall include in its calculations of premiums any 
        premiums distributed to the insurer by the State 
        residual market insurance entity.
  (e) Insured Loss Shared Compensation.--
          (1) Federal share.--
                  (A) In general.--The Federal share of 
                compensation under the Program to be paid by 
                the Secretary for insured losses of an insurer 
                during each calendar year shall be equal to 85 
                percent and beginning on January 1, 2016, shall 
                decrease by 1 percentage point per calendar 
                year until equal to 80 percent of that portion 
                of the amount of such insured losses that 
                exceeds the applicable insurer deductible 
                required to be paid during such calendar year.
                  (B) Program trigger.--In the case of 
                certified acts of terrorism occurring after 
                March 31, 2006, no compensation shall be paid 
                by the Secretary under subsection (a), unless 
                the aggregate industry insured losses resulting 
                from such certified acts of terrorism exceed--
                          (i) $100,000,000, with respect to 
                        such insured losses occurring in 
                        calendar year 2015;
                          (ii) $120,000,000, with respect to 
                        such insured losses occurring in 
                        calendar year 2016;
                          (iii) $140,000,000, with respect to 
                        such insured losses occurring in 
                        calendar year 2017;
                          (iv) $160,000,000, with respect to 
                        such insured losses occurring in 
                        calendar year 2018;
                          (v) $180,000,000, with respect to 
                        such insured losses occurring in 
                        calendar year 2019; and
                          (vi) $200,000,000, with respect to 
                        such insured losses occurring in 
                        calendar year 2020 and any calendar 
                        year thereafter.
                  (C) Prohibition on duplicative 
                compensation.--The Federal share of 
                compensation for insured losses under the 
                Program shall be reduced by the amount of 
                compensation provided by the Federal Government 
                to any person under any other Federal program 
                for those insured losses.
          (2) Cap on annual liability.--
                  (A) In general.--Notwithstanding paragraph 
                (1) or any other provision of Federal or State 
                law, if the aggregate insured losses exceed 
                $100,000,000,000, during a calendar year--
                          (i) the Secretary shall not make any 
                        payment under this title for any 
                        portion of the amount of such losses 
                        that exceeds $100,000,000,000; and
                          (ii) no insurer that has met its 
                        insurer deductible shall be liable for 
                        the payment of any portion of the 
                        amount of such losses that exceeds 
                        $100,000,000,000.
                  (B) Insurer share.--
                          (i) In general.--For purposes of 
                        subparagraph (A), the Secretary shall 
                        determine the pro rata share of insured 
                        losses to be paid by each insurer that 
                        incurs insured losses under the 
                        Program, except that, notwithstanding 
                        paragraph (1) or any other provision of 
                        Federal or State law, no insurer may be 
                        required to make any payment for 
                        insured losses in excess of its 
                        deductible under section 102(7) 
                        combined with its share of insured 
                        losses under paragraph (1)(A) of this 
                        subsection.
                          (ii) Regulations.--Not later than 240 
                        days after the date of enactment of the 
                        Terrorism Risk Insurance Program 
                        Reauthorization Act of 2007, the 
                        Secretary shall issue final regulations 
                        for determining the pro rata share of 
                        insured losses under the Program when 
                        insured losses exceed $100,000,000,000, 
                        in accordance with clause (i).
                          (iii) Report to congress.--Not later 
                        than 120 days after the date of 
                        enactment of the Terrorism Risk 
                        Insurance Program Reauthorization Act 
                        of 2007, the Secretary shall provide a 
                        report to the Committee on Banking, 
                        Housing, and Urban Affairs of the 
                        Senate and the Committee on Financial 
                        Services of the House of 
                        Representatives describing the process 
                        to be used by the Secretary for 
                        determining the allocation of pro rata 
                        payments for insured losses under the 
                        Program when such losses exceed 
                        $100,000,000,000.
          (3) Notice to congress.--The Secretary shall notify 
        the Congress if estimated or actual aggregate insured 
        losses exceed $100,000,000,000 during any calendar 
        year. The Secretary shall provide an initial notice to 
        Congress not later than 15 days after the date of an 
        act of terrorism, stating whether the Secretary 
        estimates that aggregate insured losses will exceed 
        $100,000,000,000.
          (4) Final netting.--The Secretary shall have sole 
        discretion to determine the time at which claims 
        relating to any insured loss or act of terrorism shall 
        become final.
          (5) Determinations final.--Any determination of the 
        Secretary under this subsection shall be final, unless 
        expressly provided, and shall not be subject to 
        judicial review.
          (6) Insurance marketplace aggregate retention 
        amount.--
                  (A) In general.--For purposes of paragraph 
                (7), the insurance marketplace aggregate 
                retention amount shall be the lesser of--
                          (i) $27,500,000,000, as such amount 
                        is revised pursuant to this paragraph; 
                        and
                          (ii) the aggregate amount, for all 
                        insurers, of insured losses during such 
                        calendar year.
                  (B) Revision of insurance marketplace 
                aggregate retention amount.--
                          (i) Phase-in.--Beginning in the 
                        calendar year of enactment of the 
                        Terrorism Risk Insurance Program 
                        Reauthorization Act of 2015, the amount 
                        set forth under subparagraph (A)(i) 
                        shall increase by $2,000,000,000 per 
                        calendar year until equal to 
                        $37,500,000,000.
                          (ii) Further revision.--Beginning in 
                        the calendar year that follows the 
                        calendar year in which the amount set 
                        forth under subparagraph (A)(i) is 
                        equal to $37,500,000,000, the amount 
                        under subparagraph (A)(i) shall be 
                        revised to be the amount equal to the 
                        annual average of the sum of insurer 
                        deductibles for all insurers 
                        participating in the Program for the 
                        prior 3 calendar years, as such sum is 
                        determined by the Secretary under 
                        subparagraph (C).
                  (C) Rulemaking.--Not later than 3 years after 
                the date of enactment of the Terrorism Risk 
                Insurance Program Reauthorization Act of 2015, 
                the Secretary shall--
                          (i) issue final rules for determining 
                        the amount of the sum described under 
                        subparagraph (B)(ii); and
                          (ii) provide a timeline for public 
                        notification of such determination.
          (7) Recoupment of federal share.--
                  (A) Mandatory recoupment amount.--For 
                purposes of this paragraph, the mandatory 
                recoupment amount shall be the difference 
                between--
                          (i) the insurance marketplace 
                        aggregate retention amount under 
                        paragraph (6); and
                          (ii) the aggregate amount, for all 
                        insurers, of insured losses during such 
                        period that are not compensated by the 
                        Federal Government because such 
                        losses--
                                  (I) are within the insurer 
                                deductible for the insurer 
                                subject to the losses; or
                                  (II) are within the portion 
                                of losses of the insurer that 
                                exceed the insurer deductible, 
                                but are not compensated 
                                pursuant to paragraph (1).
                  (B) [Reserved.]
                  (C) Mandatory establishment of surcharges to 
                recoup mandatory recoupment amount.--The 
                Secretary shall collect, for repayment of the 
                Federal financial assistance provided in 
                connection with all acts of terrorism (or acts 
                of war, in the case of workers compensation), 
                terrorism loss risk-spreading premiums in an 
                amount equal to 140 percent of any mandatory 
                recoupment amount as calculated under 
                subparagraph (A) for such period.
                  (D) Discretionary recoupment of remainder of 
                financial assistance.--To the extent that the 
                amount of Federal financial assistance provided 
                exceeds any mandatory recoupment amount, the 
                Secretary may recoup, through terrorism loss 
                risk-spreading premiums, such additional 
                amounts that the Secretary believes can be 
                recouped, based on--
                          (i) the ultimate costs to taxpayers 
                        of no additional recoupment;
                          (ii) the economic conditions in the 
                        commercial marketplace, including the 
                        capitalization, profitability, and 
                        investment returns of the insurance 
                        industry and the current cycle of the 
                        insurance markets;
                          (iii) the affordability of commercial 
                        insurance for small- and medium-sized 
                        businesses; and
                          (iv) such other factors as the 
                        Secretary considers appropriate.
                  (E) Timing of mandatory recoupment.--
                          (i) In general.--If the Secretary is 
                        required to collect terrorism loss 
                        risk-spreading premiums under 
                        subparagraph (C)--
                                  (I) for any act of terrorism 
                                that occurs on or before 
                                December 31, [2022] 2029, the 
                                Secretary shall collect all 
                                required premiums by September 
                                30, [2024] 2031;
                                  (II) for any act of terrorism 
                                that occurs between January 1 
                                and December 31, [2023] 2030, 
                                the Secretary shall collect 35 
                                percent of any required 
                                premiums by September 30, 
                                [2024] 2031, and the remainder 
                                by September 30, [2029] 2036; 
                                and
                                  (III) for any act of 
                                terrorism that occurs on or 
                                after January 1, [2024] 2031, 
                                the Secretary shall collect all 
                                required premiums by September 
                                30, [2029] 2036.
                          (ii) Regulations required.--Not later 
                        than 180 days after the date of 
                        enactment of this subparagraph, the 
                        Secretary shall issue regulations 
                        describing the procedures to be used 
                        for collecting the required premiums in 
                        the time periods referred to in clause 
                        (i).
                  (F) Notice of estimated losses.--Not later 
                than 90 days after the date of an act of 
                terrorism, the Secretary shall publish an 
                estimate of aggregate insured losses, which 
                shall be used as the basis for determining 
                whether mandatory recoupment will be required 
                under this paragraph. Such estimate shall be 
                updated as appropriate, and at least annually.
          (8) Policy surcharge for terrorism loss risk-
        spreading premiums.--
                  (A) Policyholder premium.--Any amount 
                established by the Secretary as a terrorism 
                loss risk-spreading premium shall--
                          (i) be imposed as a policyholder 
                        premium surcharge on property and 
                        casualty insurance policies in force 
                        after the date of such establishment;
                          (ii) begin with such period of 
                        coverage during the year as the 
                        Secretary determines appropriate; and
                          (iii) be based on a percentage of the 
                        premium amount charged for property and 
                        casualty insurance coverage under the 
                        policy.
                  (B) Collection.--The Secretary shall provide 
                for insurers to collect terrorism loss risk-
                spreading premiums and remit such amounts 
                collected to the Secretary.
                  (C) Percentage limitation.--A terrorism loss 
                risk-spreading premium collected on a 
                discretionary basis pursuant to paragraph 
                (7)(D) may not exceed, on an annual basis, the 
                amount equal to 3 percent of the premium 
                charged for property and casualty insurance 
                coverage under the policy.
                  (D) Adjustment for urban and smaller 
                commercial and rural areas and different lines 
                of insurance.--
                          (i) Adjustments.--In determining the 
                        method and manner of imposing terrorism 
                        loss risk-spreading premiums, including 
                        the amount of such premiums, the 
                        Secretary shall take into 
                        consideration--
                                  (I) the economic impact on 
                                commercial centers of urban 
                                areas, including the effect on 
                                commercial rents and commercial 
                                insurance premiums, 
                                particularly rents and premiums 
                                charged to small businesses, 
                                and the availability of lease 
                                space and commercial insurance 
                                within urban areas;
                                  (II) the risk factors related 
                                to rural areas and smaller 
                                commercial centers, including 
                                the potential exposure to loss 
                                and the likely magnitude of 
                                such loss, as well as any 
                                resulting cross-subsidization 
                                that might result; and
                                  (III) the various exposures 
                                to terrorism risk for different 
                                lines of insurance.
                          (ii) Recoupment of adjustments.--Any 
                        mandatory recoupment amounts not 
                        collected by the Secretary because of 
                        adjustments under this subparagraph 
                        shall be recouped through additional 
                        terrorism loss risk-spreading premiums, 
                        in accordance with the timing 
                        requirements of paragraph (7)(E).
                  (E) Timing of premiums.--The Secretary may 
                adjust the timing of terrorism loss risk-
                spreading premiums to provide for equivalent 
                application of the provisions of this title to 
                policies that are not based on a calendar year, 
                or to apply such provisions on a daily, 
                monthly, or quarterly basis, as appropriate.
  (f) Captive Insurers and Other Self-Insurance Arrangements.--
The Secretary may, in consultation with the NAIC or the 
appropriate State regulatory authority, apply the provisions of 
this title, as appropriate, to other classes or types of 
captive insurers and other self-insurance arrangements by 
municipalities and other entities (such as workers' 
compensation self-insurance programs and State workers' 
compensation reinsurance pools), but only if such application 
is determined before the occurrence of an act of terrorism in 
which such an entity incurs an insured loss and all of the 
provisions of this title are applied comparably to such 
entities.
  (g) Reinsurance to Cover Exposure.--
          (1) Obtaining coverage.--This title may not be 
        construed to limit or prevent insurers from obtaining 
        reinsurance coverage for insurer deductibles or insured 
        losses retained by insurers pursuant to this section, 
        nor shall the obtaining of such coverage affect the 
        calculation of such deductibles or retentions.
          (2) Limitation on financial assistance.--The amount 
        of financial assistance provided pursuant to this 
        section shall not be reduced by reinsurance paid or 
        payable to an insurer from other sources, except that 
        recoveries from such other sources, taken together with 
        financial assistance for the calendar year provided 
        pursuant to this section, may not exceed the aggregate 
        amount of the insurer's insured losses for the calendar 
        year. If such recoveries and financial assistance for 
        the calendar year exceed such aggregate amount of 
        insured losses for the calendar year and there is no 
        agreement between the insurer and any reinsurer to the 
        contrary, an amount in excess of such aggregate insured 
        losses shall be returned to the Secretary.
  (h) Group Life Insurance Study.--
          (1) Study.--The Secretary shall study, on an 
        expedited basis, whether adequate and affordable 
        catastrophe reinsurance for acts of terrorism is 
        available to life insurers in the United States that 
        issue group life insurance, and the extent to which the 
        threat of terrorism is reducing the availability of 
        group life insurance coverage for consumers in the 
        United States.
          (2) Conditional Coverage.--To the extent that the 
        Secretary determines that such coverage is not or will 
        not be reasonably available to both such insurers and 
        consumers, the Secretary shall, in consultation with 
        the NAIC--
                  (A) apply the provisions of this title, as 
                appropriate, to providers of group life 
                insurance; and
                  (B) provide such restrictions, limitations, 
                or conditions with respect to any financial 
                assistance provided that the Secretary deems 
                appropriate, based on the study under paragraph 
                (1).
  (i) Study and Report.--
          (1) Study.--The Secretary, after consultation with 
        the NAIC, representatives of the insurance industry, 
        and other experts in the insurance field, shall conduct 
        a study of the potential effects of acts of terrorism 
        on the availability of life insurance and other lines 
        of insurance coverage, including personal lines.
          (2) Report.--Not later than 9 months after the date 
        of enactment of this Act, the Secretary shall submit a 
        report to the Congress on the results of the study 
        conducted under paragraph (1).

           *       *       *       *       *       *       *

SEC. 108. TERMINATION OF PROGRAM.

  (a) Termination of Program.--The Program shall terminate on 
December 31, [2027] 2034.
  (b) Continuing Authority to Pay or Adjust Compensation.--
Following the termination of the Program, the Secretary may 
take such actions as may be necessary to ensure payment, 
recoupment, reimbursement, or adjustment of compensation for 
insured losses arising out of any act of terrorism occurring 
during the period in which the Program was in effect under this 
title, in accordance with the provisions of section 103 and 
regulations promulgated thereunder.
  (c) Repeal; Savings Clause.--This title is repealed on the 
final termination date of the Program under subsection (a), 
except that such repeal shall not be construed--
          (1) to prevent the Secretary from taking, or causing 
        to be taken, such actions under subsection (b) of this 
        section, paragraph (4), (5), (6), (7), or (8) of 
        section 103(e), or subsection (a)(1), (c), (d), or (e) 
        of section 104, as in effect on the day before the date 
        of such repeal, or applicable regulations promulgated 
        thereunder, during any period in which the authority of 
        the Secretary under subsection (b) of this section is 
        in effect; or
          (2) to prevent the availability of funding under 
        section 104(g) during any period in which the authority 
        of the Secretary under subsection (b) of this section 
        is in effect.
  (d) Study and Report on the Program.--
          (1) Study.--The Secretary, in consultation with the 
        NAIC, representatives of the insurance industry and of 
        policy holders, other experts in the insurance field, 
        and other experts as needed, shall assess the 
        effectiveness of the Program and the likely capacity of 
        the property and casualty insurance industry to offer 
        insurance for terrorism risk after termination of the 
        Program, and the availability and affordability of such 
        insurance for various policyholders, including 
        railroads, trucking, and public transit.
          (2) Report.--The Secretary shall submit a report to 
        the Congress on the results of the study conducted 
        under paragraph (1) not later than June 30, 2005.
  (e) Analysis of Market Conditions for Terrorism Risk 
Insurance.--
          (1) In general.--The President's Working Group on 
        Financial Markets, in consultation with the National 
        Association of Insurance Commissioners, representatives 
        of the insurance industry, representatives of the 
        securities industry, and representatives of policy 
        holders, shall perform an ongoing analysis regarding 
        the long-term availability and affordability of 
        insurance for terrorism risk.
          (2) Report.--Not later than September 30, 2006, and 
        thereafter in 2010 and 2013, the President's Working 
        Group on Financial Markets shall submit a report to the 
        Committee on Banking, Housing, and Urban Affairs of the 
        Senate and the Committee on Financial Services of the 
        House of Representatives on its findings pursuant to 
        the analysis conducted under paragraph (1).
  (f) Insurance for Nuclear, Biological, Chemical, and 
Radiological Terrorist Events.--
          (1) Study.--The Comptroller General of the United 
        States shall examine--
                  (A) the availability and affordability of 
                insurance coverage for losses caused by 
                terrorist attacks involving nuclear, 
                biological, chemical, or radiological 
                materials;
                  (B) the outlook for such coverage in the 
                future; and
                  (C) the capacity of private insurers and 
                State workers compensation funds to manage risk 
                associated with nuclear, biological, chemical, 
                and radiological terrorist events.
          (2) Report.--Not later than 1 year after the date of 
        enactment of the Terrorism Risk Insurance Program 
        Reauthorization Act of 2007, the Comptroller General 
        shall submit to the Committee on Banking, Housing, and 
        Urban Affairs of the Senate and the Committee on 
        Financial Services of the House of Representatives a 
        report containing a detailed statement of the findings 
        under paragraph (1), and recommendations for any 
        legislative, regulatory, administrative, or other 
        actions at the Federal, State, or local levels that the 
        Comptroller General considers appropriate to expand the 
        availability and affordability of insurance for 
        nuclear, biological, chemical, or radiological 
        terrorist events.
  (g) Availability and Affordability of Terrorism Insurance in 
Specific Markets.--
          (1) Study.--The Comptroller General of the United 
        States shall conduct a study to determine whether there 
        are specific markets in the United States where there 
        are unique capacity constraints on the amount of 
        terrorism risk insurance available.
          (2) Elements of study.--The study required by 
        paragraph (1) shall contain--
                  (A) an analysis of both insurance and 
                reinsurance capacity in specific markets, 
                including pricing and coverage limits in 
                existing policies;
                  (B) an assessment of the factors contributing 
                to any capacity constraints that are 
                identified; and
                  (C) recommendations for addressing those 
                capacity constraints.
          (3) Report.--Not later than 180 days after the date 
        of enactment of the Terrorism Risk Insurance Program 
        Reauthorization Act of 2007, the Comptroller General 
        shall submit a report on the study required by 
        paragraph (1) to the Committee on Banking, Housing, and 
        Urban Affairs of the Senate and the Committee on 
        Financial Services of the House of Representatives.
  (h) Study of Small Insurer Market Competitiveness.--
          (1) In general.--Not later than June 30, 2017, and 
        every other June 30 thereafter, the Secretary shall 
        conduct a study of small insurers (as such term is 
        defined by regulation by the Secretary) participating 
        in the Program, and identify any competitive challenges 
        small insurers face in the terrorism risk insurance 
        marketplace, including--
                  (A) changes to the market share, premium 
                volume, and policyholder surplus of small 
                insurers relative to large insurers;
                  (B) how the property and casualty insurance 
                market for terrorism risk differs between small 
                and large insurers, and whether such a 
                difference exists within other perils;
                  (C) the impact of the Program's mandatory 
                availability requirement under section 103(c) 
                on small insurers;
                  (D) the effect of increasing the trigger 
                amount for the Program under section 
                103(e)(1)(B) on small insurers;
                  (E) the availability and cost of private 
                reinsurance for small insurers; and
                  (F) the impact that State workers 
                compensation laws have on small insurers and 
                workers compensation carriers in the terrorism 
                risk insurance marketplace.
          (2) Report.--The Secretary shall submit a report to 
        the Congress setting forth the findings and conclusions 
        of each study required under paragraph (1).

           *       *       *       *       *       *       *

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 


                            DISSENTING VIEWS

    Too often, Congress reflexively renews sprawling federal 
backstops that the market no longer needs--quietly gambling 
with taxpayers' exposure to potentially massive losses while 
ignoring the absence of any real market breakdown. This TRIA 
reauthorization fits the pattern perfectly: another automatic 
green light for an open-ended federal guarantee, despite no 
evidence of a genuine market failure.
    I think it's important to recall exactly what Congress 
intended when it created the Terrorism Risk Insurance Act, or 
TRIA. The statute laid out that the program was established as 
`` . . . a temporary federal program that provides for a 
transparent system of shared public and private compensation 
for insured losses resulting from acts of terrorism, in order 
to (1) protect consumers by addressing market disruptions and 
ensure the continued widespread availability and affordability 
of property and casualty insurance for terrorism risk; and (2) 
allow for a transitional period for the private markets to 
stabilize, resume pricing of such insurance, and build capacity 
to absorb any future losses, while preserving State insurance 
regulation and consumer protections.''
    That's the law's own language--and the key phrase here is 
``temporary federal program.'' TRIA was never meant to be 
permanent. It was designed to give the private market time to 
adjust, mature, and ultimately take full responsibility for 
insuring against terrorism risk. Yet here we are, twenty plus 
years later, marking up another long-term reauthorization that 
continues to rely on federal involvement instead of 
meaningfully reducing it.
    I have great respect for my colleagues who have worked hard 
on this proposal, but I believe that H.R. 7128 misses an 
opportunity. Rather than putting TRIA on a path toward less 
government exposure and greater private-sector responsibility, 
this bill extends the federal backstop until December 31, 
2034--nearly nine years from now. That's hardly consistent with 
the statute's intent of providing a ``transitional'' program.
    I also believe that H.R. 7128 violates the spirit--if not 
the letter--of the House Republican floor protocols for the 
119th Congress, particularly the requirement that federal 
programs be subject to a sunset ``not later than seven years'' 
after spending is first authorized or continued. Under Section 
2, H.R. 7128 does not merely ``add seven years'' to a distant 
end date; it strikes ``2027'' and inserts ``2034,'' making this 
authorization effective as soon as the bill is enacted and 
keeping TRIA in force through the end of 2034.
    In my view, the proper way to apply our Conference's seven-
year sunset standard is to measure from when the reauthorized 
program actually takes effect--namely, when this bill is signed 
into law and TRIA's federal backstop is once again authorized. 
In other words, the ``clock'' should start when we newly 
authorize or continue the program, not from the old termination 
date written in prior law. Viewed that way, characterizing H.R. 
7128 as a simple seven-year extension obscures the reality that 
Congress would be reauthorizing a significant federal program 
for nearly a decade at once, in tension with our Conference's 
stated commitment to regular review and reconsideration of 
federal spending and backstop authorities.
    This is especially concerning given that, to date, TRIA has 
never been activated. In the 20 plus years since TRIA was 
enacted, there has not been a single Treasury-certified act of 
terrorism that met the program's financial trigger. Not once 
has the federal government been required to step in under TRIA.
    Meanwhile, the private insurance industry has not just done 
well in this space--it has thrived under the shelter of a 
taxpayer-funded guarantee. According to the Treasury 
Department, from 2003 to 2023 insurers collected roughly $56.7 
billion in terrorism risk premiums.
    That is not the profile of a fragile market in need of 
permanent federal protection; it is evidence that insurers have 
the experience, capital, and appetite to keep cashing premium 
checks while the public absorbs the worst-case downside risks. 
In effect, taxpayers provide free reinsurance so that insurance 
carriers can book steady revenue and protect record surpluses--
a classic example of privatized gains and socialized risk. 
Given this track record, the question is no longer whether 
insurance companies can begin to shoulder more of the risk, but 
why they have been allowed to avoid doing so for this long.
    Yet instead of taking any meaningful steps to scale down 
taxpayer exposure or establish a serious glide path for an 
eventual federal exit, this bill simply extends the program 
nearly as-is. I find that deeply disappointing, because I do 
not believe the federal government should be in the business of 
permanently backstopping risks that the private sector is 
clearly capable of handling on its own.
    It did not have to be this way. I offered an amendment that 
I believe would have greatly improved this bill by beginning 
the long-overdue process of shifting more terrorism risk off 
taxpayers and back onto the well-capitalized insurance industry 
where it belongs.
    First, my amendment would have reduced the federal cost 
share. Under current law, the federal government covers 80 
percent of covered losses above insurer deductibles. My 
amendment would have reset that share to 75 percent and then 
ratcheted it down by 1 percentage point a year until it reached 
70 percent. This would have created a gradual, predictable 
glide path that would give insurers time to adjust while 
steadily reducing federal exposure and putting more 
responsibility back on the private market where it belongs.
    Second, my amendment would have reduced the circumstances 
under which taxpayers are forced to step in. Under current law, 
the program trigger remains frozen at $200 million. My 
amendment would have raised that trigger by $10 million per 
year until it reached $250 million, and then indexed it to 
inflation using a benchmark selected by the Treasury Secretary 
through a rulemaking process. That approach would have kept the 
trigger aligned with economic reality instead of shrinking in 
real terms and quietly expanding the federal role, ensuring 
that more of the risk stays with insurers rather than being 
shifted to taxpayers.
    Third, my amendment would have shortened the length of the 
reauthorization by changing the program termination date to 
five years after enactment. Five years provides ample certainty 
for markets, but it also respects the fact that TRIA was 
supposed to be temporary, and that Congress should regularly 
revisit the scope of federal involvement.
    Fourth, my amendment would have forced Treasury to do the 
serious homework this bill avoids, laying out how, within a few 
years, we could dramatically reduce taxpayer risk and make the 
industry shoulder a larger share of the costs. It would have 
directed Treasury to study how an annual participation fee on 
insurers in TRIA could be structured, including options that 
generate substantial aggregate fees and deposit them into a 
dedicated fund at Treasury that can be used solely to cover 
future federal outlays or reimbursements under the program. The 
study would have been required to examine fee designs that are 
proportionate to insurer size and premiums, so that large 
national carriers shoulder the largest share while small and 
regional insurers are not disproportionately burdened.
    It also would have evaluated whether a carefully designed 
opt-out for small insurers from the mandatory availability 
requirement could work without undermining the long-term health 
of the program. Treasury would then have been required to 
report back to this Committee with concrete findings and 
legislative options, giving us real data to build a system that 
shifts more risk off taxpayers and onto the well-capitalized 
insurance companies that benefit from TRIA.
    My amendment would not have pulled the rug out from under 
anyone; it simply asked the insurance industry to start 
standing on its own two feet. It took modest, measured steps to 
ratchet down the federal share, raise and index the trigger, 
shorten a long-term reauthorization, and finally force a 
serious conversation about a participation fee and dedicated 
fund that would put taxpayers ahead of industry convenience.
    When Congress tells the public a program will be temporary, 
we incur more than a procedural obligation--we make a promise. 
In TRIA's case, there is no ambiguity about that promise: the 
statute itself describes it as a temporary federal program. The 
Members of Congress considering this legislation have, in my 
view, a covenant with our predecessors who first authorized 
TRIA on that basis. To honor that covenant, we must either set 
this program on a genuine path of reform, as my amendment would 
have done, or have the courage to let it expire. A long-term 
extension with only minimal changes does not satisfy that 
obligation.
    I want to thank Chairman Flood and Chairman Hill for their 
leadership and for their efforts to maintain stability in this 
space, and I appreciate their willingness to engage in this 
important discussion. But when we shrink from doing the 
difficult things; when we refuse to challenge an industry all 
too eager to cash terrorism insurance premium checks backed by 
taxpayers; when we cannot even agree on modest, common-sense 
reforms to a backstop that has never once been triggered, we 
miss a rare opportunity to leave the terrorism insurance 
marketplace stronger and more accountable than we found it. For 
all of these reasons, I must oppose H.R. 7128 in its current 
form.

            Sincerely,
                                                 John Rose,
                                                Member of Congress.

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