[Federal Register Volume 86, Number 61 (Thursday, April 1, 2021)]
[Notices]
[Pages 17265-17266]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-06698]


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DEPARTMENT OF THE TREASURY


Comments in Aid of Analyses of the Terrorism Risk Insurance 
Program

AGENCY: Departmental Offices, U.S. Department of the Treasury.

ACTION: Request for comments.

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SUMMARY: The Terrorism Risk Insurance Act of 2002 (TRIA) created the 
Terrorism Risk Insurance Program (TRIP or Program) to address 
disruptions in the market for terrorism risk insurance, to help ensure 
the continued availability and affordability of commercial property and 
casualty insurance for terrorism risk, and to allow for the private 
markets to stabilize and build insurance capacity to absorb any future 
losses for terrorism events. The Secretary of the Treasury (Secretary) 
administers the Program, with the assistance of the Federal Insurance 
Office (FIO). Treasury requests comments from interested parties 
concerning the issues that FIO will be analyzing in connection with its 
next report concerning the participation of small insurers in the 
Program, including any competitive challenges such insurers face in the 
terrorism risk insurance marketplace.

DATES: Submit comments on or before May 17, 2021.

ADDRESSES: Submit comments electronically through the Federal 
eRulemaking Portal: http://www.regulations.gov, or by mail to the 
Federal Insurance Office, Attn: Richard Ifft, Room 1410 MT, Department 
of the Treasury, 1500 Pennsylvania Avenue NW, Washington, DC 20220. 
Because postal mail may be subject to processing delays, it is 
recommended that comments be submitted electronically. If submitting 
comments by mail, please submit an original version with two copies. 
Comments should be captioned with ``2021 TRIA Small Insurer Study 
Comments.'' Please include your name, group affiliation, address, email 
address, and telephone number(s) in your comment.
    Where appropriate, a comment should include a short Executive 
Summary (no more than five single-spaced pages).

FOR FURTHER INFORMATION CONTACT: Richard Ifft, Senior Insurance 
Regulatory Policy Analyst, Federal Insurance Office, Room 1410 MT, 
Department of the Treasury, 1500 Pennsylvania Avenue NW, Washington, DC 
20220, at (202) 622-2922 (not a toll-free number), Lindsey Baldwin, 
Senior Insurance Regulatory Policy Analyst, Federal Insurance Office, 
at (202) 622-3220 (not a toll free number), or Daniel McKnight, Policy 
Analyst, Federal Insurance Office, at (202) 622-7009 (not a toll free 
number). Persons who have difficulty hearing or speaking may access 
these numbers via TTY by calling the toll-free Federal Relay Service at 
(800) 877-8339.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 104(h) of TRIA \1\ directs the Secretary, beginning in 
calendar year 2016, to ``require insurers participating in the Program 
to submit to the Secretary such information regarding insurance 
coverage for terrorism losses of such insurers as the Secretary 
considers appropriate to analyze the effectiveness of the Program[.]'' 
This information and data includes information regarding: (1) Lines of 
insurance with exposure to such losses;

[[Page 17266]]

(2) premiums earned on such coverage; (3) geographical location of 
exposures; (4) pricing of such coverage; (5) the take-up rate for such 
coverage; (6) the amount of private reinsurance for acts of terrorism 
purchased; and (7) such other matters as the Secretary considers 
appropriate.
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    \1\ Public Law 107-297, 116 Stat. 2322, codified at 15 U.S.C. 
6701, note. As the provisions of TRIA (as amended) appear in a note, 
instead of particular sections, of the United States Code, the 
provisions of TRIA are identified by the sections of the law.
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    In addition, Section 108(h) of TRIA requires the Secretary to 
conduct, by June 30, 2017 and every other year thereafter, a study of 
small insurers (to be defined by the Secretary, as has been done under 
31 CFR 50.4(z)) participating in the Program to identify any 
competitive challenges that small insurers face in the terrorism risk 
insurance marketplace. Section 108(h) also identifies specific matters 
that Treasury is required to analyze in the small insurers study. In 
addition to the data that Treasury has previously collected and will be 
collecting in the future, Treasury seeks comments for use in the study 
that Treasury must conduct concerning the participation of small 
insurers in the Program.

II. Solicitation for Comments on Small Insurer Participation in the 
Program

    As discussed above, Treasury will be collecting certain data from 
small insurers as part of its 2021 TRIP Data Call,\2\ which Treasury 
will use (along with data collected by Treasury during prior TRIP Data 
Calls) in connection with the study. Treasury welcomes comments 
concerning small insurer participation in the Program generally, and 
invites responses to the following particular issues specified in 
Section 108(h) of TRIA:
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    \2\ The 2021 TRIP Data Call commenced March 12, 2021. See 86 FR 
14179 (March 12, 2021).
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    (1) Changes to the market share, premium volume, and policyholder 
surplus of small insurers relative to large insurers.
    (2) 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.
    (3) The impact of the Program's mandatory availability requirement 
under Section 103(c) of TRIA on small insurers.
    (4) The effect of increasing the trigger amount for the Program 
under Section 103(e)(1)(B) of TRIA for small insurers.
    (5) The availability and cost of private reinsurance for small 
insurers.
    (6) The impact that state workers' compensation laws have on small 
insurers and workers' compensation carriers in the terrorism risk 
insurance marketplace.

In addition, Treasury welcomes qualitative and quantitative comments on 
the following specific topics that may be relevant to the 
competitiveness of small insurers in the terrorism risk insurance 
marketplace.
    (1) Any potential constraints on the ability of small insurers to 
provide coverage for nuclear, chemical, biological, and radiological 
(NBCR) risks.
    (2) Any risk management strategies and challenges faced by small 
insurers in maintaining the ability to pay losses associated with 
insured claims that are not subject to claims for the federal share of 
compensation (e.g., losses below the Program Trigger, within the 
insurer deductible, and within the insurer co- pay share).
    (3) The impact, if any, on small insurer participation in the 
terrorism risk insurance marketplace of the 2019 reauthorization of the 
Program until December 31, 2027, under the sharing mechanisms in place 
as of Calendar Year 2020.\3\
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    \3\ See Terrorism Risk Insurance Program Reauthorization Act of 
2019, Public Law 116-94, 133 Stat. 2534.
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    (4) The role of small insurers in covering cyber-related acts of 
terrorism under the Program.
    (5) The role of small insurers in covering terrorism risk under the 
Program for Places of Worship.\4\
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    \4\ As defined in Treasury's 2020 and 2021 TRIP Data Calls. See, 
e.g., Instructions for Terrorism Risk Insurance Program (TRIP) 2021 
Data Call Small Insurers at 16-18, https://home.treasury.gov/system/files/311/Small-Final-Instructions-2021.pdf.
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    (6) Any potential issues posed for small insurers in the terrorism 
risk insurance marketplace by market impacts resulting from the COVID-
19 pandemic.
    Treasury issued its first two studies of small insurers under TRIA 
in June 2017\5\ and June 2019.\6\ In those studies, Treasury addressed 
the statutory issues identified above, with reference to data collected 
by Treasury in the TRIP Data Calls, as well as other available sources. 
Treasury requests further comment on these issues from interested 
parties, particularly with respect to any issue that an interested 
party believes may not be fully evident solely by reference to the 
aggregated data collected by Treasury.
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    \5\ U.S. Treasury, Study of Small Insurer Competitiveness in the 
Terrorism Risk Insurance Marketplace (June 2017), https://home.treasury.gov/system/files/311/Study_of_Small_Insurer_Competitiveness_in_the_Terrorism_R 
isk_Insurance_Marketplace_%28June_2017%29.pdf.
    \6\ U.S. Treasury, Study of Small Insurer Competitiveness in the 
Terrorism Risk Insurance Marketplace (June 2019), https://home.treasury.gov/system/files/311/2019_TRIP_SmallInsurer_Report.pdf.

    Dated: March 24, 2021.
Steven E. Seitz,
Director, Federal Insurance Office.
[FR Doc. 2021-06698 Filed 3-31-21; 8:45 am]
BILLING CODE 4810-AK-P