Ohio Director Offers Terror Risk Act Bulletin

Ohio Department of Insurance Director Mary Jo Hudson has issued a bulletin concerning the recent extension of the Terrorism Risk Insurance Act (TRIA), as enacted by Congress and signed by the President. The bulletin advises Ohio insurers of certain provisions of the Terrorism Risk Insurance Program Reauthorization Extension Act of 2007 that may require insurers to submit a filing to the Department. "There have been several provisions of the initial Act that have changed in the Extension Act of 2007,” said Director Hudson. “Given that insurers and advisory organizations must accelerate filing activity in order to achieve compliance with the Act, the Department will assist by permitting filings for terrorism losses to be submitted on a use & file basis." The Department will suspend its “Prior Approval” and “File & Use” filing procedures until April 1, 2008. This suspension applies only to rate, rule and forms filings pertaining to “certified” and “non-certified” terrorism losses for commercial property and casualty lines of business. Signed into law in 2002, the Terrorism Risk Insurance Act provides a federal backstop for defined acts of terrorism and imposes certain obligations on insurers. The Act was extended for a two-year period in 2005 and was recently extended again through 2014.

Changes to the initial Act include:

Revising the definition of a certified act of terrorism to eliminate the requirement that the individual(s) are acting on behalf of any foreign person or foreign interest. Extending the program through Dec. 31, 2014. Requiring clear and conspicuous notice to policyholders of the existence of the $100,000,000,000 cap.