Casualty Insurance Policies News

The Treasury Department reminded all participants and observers of the Terrorism Risk Insurance Program that there will be two important changes in the program’s administration in 2004. As mandated by Congress, beginning on January 1, 2004 and throughout the remainder of 2004, an insurer’s deductible will increase from 7 percent to 10 percent of the insurer’s direct earned premium over the previous calendar year. Second, the “mandatory availability” provisions of the Act will require insurers to continue to make available coverage for certified acts of terrorism for the full annual policy periods of all commercial property and casualty insurance policies that are issued or renewed in 2004.

The U.S. Department of the Treasury issued a Press Release stating that it is extending through 2005 the “make available” provision of the Terrorism Risk Insurance Act (TRIA). This provision requires certain insurers to make available in all their commercial property and casualty insurance policies coverage for losses due to covered acts of terrorism in a manner that does not materially differ from the terms, amounts, and other coverage limitations applicable to losses arising from events other than acts of terrorism. (HK Law).