Terrorism Insurance Backstop Extension Act of 2005 - Amends the Terrorism Risk Insurance Act of 2002 to define: (1) the term "Program Year 4" as the period from January 1, 2006, through December 31, 2006; and (2) the term "Program Year 5" as the period from January 1, 2007, from December 31, 2007 (thereby extending the terrorism risk insurance program from 2005 through 2007).
Sets a deadline for the Secretary of the Treasury to make a final determination regarding: (1) the availability of group life insurance to both insurers and consumers; and (2) whether certain provisions of the Act shall be applied to providers of group life insurance.
Sunsets the Terrorism Risk Insurance Program after December 31, 2007.
Details the treatment of insured losses and the insurer deductible for the Final Program Year (January 1, 2008, through December 31, 2008).
[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1153 Introduced in House (IH)]
109th CONGRESS
1st Session
H. R. 1153
To extend the terrorism insurance program of the Department of the
Treasury.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 8, 2005
Mr. Capuano (for himself, Mr. Israel, Mr. Frank of Massachusetts, Mr.
Kanjorski, and Mr. Crowley) introduced the following bill; which was
referred to the Committee on Financial Services
_______________________________________________________________________
A BILL
To extend the terrorism insurance program of the Department of the
Treasury.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Terrorism Insurance Backstop
Extension Act of 2005''.
SEC. 2. EXTENSION OF TERRORISM INSURANCE PROGRAM.
(a) Program Years 4 and 5.--Paragraph (11) of section 102 of the
Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended
by adding at the end the following new subparagraphs:
``(E) Program year 4.--The term `Program Year 4'
means the period beginning on January 1, 2006 and
ending on December 31, 2006.
``(F) Program year 5.--The term `Program Year 5'
means the period beginning on January 1, 2007 and
ending on December 31, 2007.''.
(b) Insurer Deductible.--Paragraph (7) of section 102 of the
Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended--
(1) by redesignating subparagraph (E) as subparagraph (H);
(2) in subparagraph (D), by striking ``and'' at the end;
(3) by inserting after subparagraph (D) the following new
subparagraphs:
``(E) for Program Year 4, the value of an insurer's
direct earned premiums over the calendar year
immediately preceding Program Year 4, multiplied by 15
percent;
``(F) for Program Year 5, the value of an insurer's
direct earned premiums over the calendar year
immediately preceding Program Year 4, multiplied by 20
percent; and'';
(4) in subparagraph (H) (as so redesignated by paragraph
(1) of this subsection)--
(A) by striking ``(D)'' and inserting ``(F)''; and
(B) by striking ``or Program Year 3'' and inserting
``Program Year 3, Program Year 4, or Program Year 5''.
(c) Mandatory Availability.--Subsection (c) of section 103 of the
Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended--
(1) by striking all of the matter that precedes
subparagraph (A) of paragraph (1) and inserting the following:
``(c) Mandatory Availability.--During the Program, each entity that
meets the definition of an insurer under section 102--'';
(2) by striking paragraph (2); and
(3) by redesignating subparagraphs (A) and (B) as
paragraphs (1) and (2) and realigning such paragraphs, as so
redesignated, so as to be indented 2 ems from the left margin.
(d) Insured Loss Shared Compensation.--Subsection (e) of section
103 of the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note)
is amended--
(1) in paragraph (2)(A), by striking ``or Program Year 3''
and inserting ``, Program Year 3, Program Year 4, Program Year
5, or the final Program Year'';
(2) in paragraph (3), by striking ``or Program Year 3'' and
inserting ``, Program Year 3, Program Year 4, Program Year 5,
or the final Program Year'';
(3) in paragraph (6)--
(A) in subparagraph (B), by striking ``and'' at the
end;
(B) in subparagraph (C) by striking the period at
the end and inserting a semicolon; and
(C) by adding at the end the following new
subparagraphs:
``(D) for Program Year 4, the lesser of--
``(i) $17,500,000,000; and
``(ii) the aggregate amount, for all
insurers, of insured losses during such Program
Year;
``(E) for each of Program Year 5 and the Final
Program Year, the lesser of--
``(i) $20,000,000,000; and
``(ii) the aggregate amount, for all
insurers, of insured losses during such Program
Year; and''; and
(4) in paragraph (7)--
(A) in subparagraph (A), by striking ``and (C)''
and inserting ``(C), (D), and (E)''; and
(B) in subparagraphs (B) and (C), by striking ``or
(C)'' each place such term appears and inserting ``(C),
(D), or (E)''.
(e) Coverage of Group Life Insurance.--
(1) In general.--Paragraph (5) of section 102 of the
Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is
amended in the matter that precedes subparagraph (A) by
inserting ``or group life'' after ``property and casualty''.
(2) Technical and conforming amendments.--The Terrorism
Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended--
(A) in section 102--
(i) in paragraph (1)--
(I) in subparagraph (B)(i), by
inserting ``or group life insurance''
after ``workers' compensation''; and
(II) in subparagraph (B)(ii), by
inserting ``and group life insurance''
after ``property and casualty
insurance'';
(ii) in paragraph (4)--
(I) by inserting ``or for group
life insurance'' after ``property and
casualty insurance''; and
(II) by striking ``paragraph (5)''
and inserting ``paragraph (6)'';
(iii) in paragraph (5), by inserting ``and
group life insurance'' after ``workers'
compensation''; and
(iv) in paragraph (6)--
(I) in subparagraph (A)(i), by
inserting ``property and casualty or
group life'' after ``excess'';
(II) in subparagraph (B), by
inserting ``or group life insurance
coverage'' after ``property and
casualty insurance coverage'';
(v) by redesignating paragraphs (5) through
(16) as paragraphs (6) through (17),
respectively; and
(vi) by inserting after paragraph (4), the
following new paragraph:
``(5) Group life insurance.--The term `group life
insurance' means an insurance contract that provides term life
insurance coverage, accidental death coverage, or a combination
thereof, for a number of persons under a single contract, on
the basis of a group selection of risks.'';
(B) in section 103--
(i) in subsection (b)(1), by inserting
``(including a named beneficiary in the case of
a group life insurance policy)'' before the
second comma;
(ii) in subsection (c)--
(I) in paragraph (1) (as so
redesignated by subsection (c)(3) of
this section), by inserting ``and group
life'' after ``property and casualty'';
and
(II) in paragraph (2) (as so
redesignated by subsection (c)(3) of
this section), by inserting ``and group
life'' after ``property and casualty'';
(iii) in subsection (e)--
(I) in paragraph (6), by striking
``For'' and inserting ``Except as
provided in subparagraph (F) of this
paragraph, for'';
(II) in paragraph (6), by inserting
after subparagraph (E) (as added by
subsection (d)(3)(C) of this section)
the following new subparagraph:
``(F) for each of the periods referred to in
subparagraphs (A) through (E), the amounts provided
under such subparagraphs, as such amounts shall be
increased by the Secretary before the expiration of the
90-day period beginning on the date of the enactment of
the Terrorism Insurance Backstop Extension Act of 2005,
based on the increase in the size of the Program caused
by the inclusion of group life insurance pursuant to
such Act, in proportion to the increased premiums
involved.'';
(III) in paragraph (7)(C), by
inserting ``or group life insurance''
after ``workers compensation'';
(IV) in paragraph (8)(A)(i), by
inserting ``and group life'' after
``property and casualty''; and
(V) in paragraph (8), by inserting
``or group life'' after ``property and
casualty'' each place such term appears
in subparagraphs (A)(iii) and (C); and
(iv) by striking subsection (h);
(C) in section 105(c), by inserting ``or group
life'' after ``property and casualty''; and
(D) in section 108(d)(1), by inserting ``and the
group life insurance industry'' after ``property and
casualty insurance industry''.
(3) Required rulemaking.--Not later than 90 days after the
date of the enactment of this Act, the Secretary of the
Treasury shall issue final regulations to carry out this
subsection.
(f) Study on Long-Term Solutions.--Section 103 of the Terrorism
Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended by striking
subsection (i) and inserting the following new subsection:
``(h) Study on Long-Term Solutions.--By September 1, 2005, the
Secretary shall conduct a study and submit a report to the Congress on
alternatives for expanding the availability and affordability of
terrorism insurance after the termination of the Program that do not
involve a Federal financial backstop.''.
(g) Termination of Program.--
(1) Termination.--Subsection (a) of section 108 of the
Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is
amended by striking ``December 31, 2005'' and inserting
``December 31, 2007''.
(2) Final gao study and report.--Subsection (d) of section
108 of the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701
note) is amended by adding at the end the following new
paragraph:
``(3) Final gao study and report.--The Comptroller General
of the United States shall conduct an assessment of the matters
referred to in paragraph (1) and shall submit a report to the
Congress, not later than June 30, 2007, on the results of such
study.''.
SEC. 3. FINAL PROGRAM YEAR.
(a) Definition.--Paragraph (11) of section 102 of the Terrorism
Risk Insurance Act of 2002 (15 U.S.C. 6701 note), as amended by the
preceding provisions of this Act, is further amended by adding at the
end the following new subparagraph:
``(G) Final program year.--The term `Final Program
Year' means the period beginning on January, 1, 2008
and ending on December 31, 2008.''. ''.
(b) Insured Losses.--Paragraph (5) of section 102 of the Terrorism
Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended by adding
after and below subparagraph (B) the following new sentence:
``With respect to the Final Program Year, such term means only
such losses as are described in the preceding sentence that are
covered by primary or excess property and casualty insurance or
group life insurance, that is issued before January 1, 2008,
and expires not later than December 31, 2008; except that the
Secretary may exclude from insured losses for the Final Program
Year losses covered by a policy for such insurance if the
Secretary determines that the primary purpose in establishing
the particular term of the policy was obtaining compensation
under the Program for losses covered by the policy.''.
(c) Insurer Deductible.--Paragraph (7) of section 102 of the
Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note), as amended
by the preceding provisions of this Act, is further amended by
inserting after subparagraph (F) the following new subparagraph:
``(G) for the Final Program Year, the value of an
insurer's direct earned premiums for the terms
remaining under any policies for insurance described in
the last sentence of paragraph (5) as of the occurrence
of the act of terrorism during such Year that results
in insured losses, as determined by the Secretary,
multiplied by 20 percent; and''.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Financial Services.
Referred to the Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises.
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