Extension Of Federal Terrorism Insurance Program To Get Hearing In NYC
Sunday, March 4th 2007, 2:25 pm
By: News On 6
NEW YORK (AP) _ A hearing this week just blocks from the World Trade Center site is aimed at determining whether the federal government will extend its terrorism property insurance program that is due to expire at the end of the year.
The government started the program because many property owners couldn't obtain private insurance coverage against terrorist catastrophes like the 9/11 attack.
New York officials are among those who have pleaded for a continuation.
``I think it should be made permanent,'' said Rep. Joseph Crowley, D-N.Y. ``Extending it would be nice. But let's put it into law.''
The federal Terrorism Risk Insurance Act was enacted 14 months after the Sept. 11, 2001, attacks that toppled the trade center's twin towers.
Fear of subsequent attacks, combined with mounting bills for trade center claims, led many insurance companies to exclude terrorism from property policies, even though it was fairly standard before the attack.
Sen. Charles Schumer said the insurance act, which reimburses insurers up to $100 million if foreign terrorists attack again, should be extended for at least 15 years. It was initially due to expire at the end of 2005, but it was extended for two years.
``The issue is vital to the rebuilding at ground zero and the economic prosperity of all large metropolitan areas,'' said Rep. Gary Ackerman, D-N.Y., who will chair the hearing at City Hall. ``Without terrorism insurance, banks will not lend money and developers will simply not be able to build.''
Critics have complained the federal intervention was an unnecessary favor to the insurance industry.
Overall insurers' costs for the Sept. 11 attacks have been estimated at $32 billion. Crowley said that number could climb in the case of a nuclear, biological or chemical terrorist attack.