Notice2025-05580
Comments in Aid of Analyses of the Terrorism Risk Insurance Program
Primary source
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Published
April 2, 2025
Issuing agencies
Treasury Department
Abstract
The Terrorism Risk Insurance Act of 2002 (TRIA) created the Terrorism Risk Insurance Program (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 regarding the issues that FIO will be analyzing in connection with its upcoming study related to the participation of small insurers in the Program, including any competitive challenges such insurers face in the terrorism risk insurance marketplace.
Full Text
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<title>Federal Register, Volume 90 Issue 62 (Wednesday, April 2, 2025)</title>
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[Federal Register Volume 90, Number 62 (Wednesday, April 2, 2025)]
[Notices]
[Pages 14522-14524]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-05580]
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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 comment.
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SUMMARY: The Terrorism Risk Insurance Act of 2002 (TRIA) created the
Terrorism Risk Insurance Program
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(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 regarding the issues that FIO will be
analyzing in connection with its upcoming study related to 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 19, 2025.
ADDRESSES: Submit comments electronically through the Federal
eRulemaking Portal: <a href="https://www.regulations.gov">https://www.regulations.gov</a>, 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 ``2025 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, Lead Management and
Senior Insurance Policy Analyst, Terrorism Risk Insurance Program, Room
1410 MT, Department of the Treasury, 1500 Pennsylvania Avenue NW,
Washington, DC 20220, at (202) 622-2922 (not a toll-free number), or
Theodore Newman, Senior Insurance Regulatory Policy Analyst, Federal
Insurance Office, at (202) 622-1748 (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; (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. 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 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 from the public for use in the study that Treasury must
conduct concerning the participation of small insurers in the Program.
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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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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 2025 TRIP Data Call, 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: (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; and (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 additional topics that may be relevant to the
competitiveness of small insurers in the terrorism risk insurance
marketplace.
(1) Any potential constraints or market effects 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 effects, if any, of the 2019 reauthorization of the Program
until December 31, 2027, on small insurer participation in the
terrorism risk insurance marketplace in light of the sharing mechanisms
in place as of Calendar Year 2020.\2\
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\2\ 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, including any relevant developments in the
cyber insurance market.
(5) The role of small insurers in covering terrorism risk under the
Program for Places of Worship.\3\
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\3\ As defined in Treasury's TRIP Data Calls. See, e.g.,
Instructions for Terrorism Risk Insurance Program (TRIP) 2024 Data
Call Small Insurers at 22, located at <a href="https://home.treasury.gov/policy-issues/financial-markets-financial-institutions-and-fiscal-service/federal-insurance-office/terrorism-risk-insurance-program/annual-data-collection">https://home.treasury.gov/policy-issues/financial-markets-financial-institutions-and-fiscal-service/federal-insurance-office/terrorism-risk-insurance-program/annual-data-collection</a>.
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(6) The use of risk modeling techniques and other analytical tools
by small insurers to assess their risk exposure to losses within the
scope of the Program.
Treasury issued its first four studies of small insurers under TRIA
in June
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2017,\4\ June 2019,\5\ June 2021,\6\ and June 2023.\7\ 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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\4\ U.S. Treasury, Study of Small Insurer Competitiveness in the
Terrorism Risk Insurance Marketplace (June 2017), <a href="https://home.treasury.gov/system/files/311/Study_of_Small_Insurer_Competitiveness_in_the_Terrorism_Risk_Insurance_Marketplace_%28June_2017%29.pdf">https://home.treasury.gov/system/files/311/Study_of_Small_Insurer_Competitiveness_in_the_Terrorism_Risk_Insurance_Marketplace_%28June_2017%29.pdf</a>.
\5\ U.S. Treasury, Study of Small Insurer Competitiveness in the
Terrorism Risk Insurance Marketplace (June 2019), <a href="https://home.treasury.gov/system/files/311/2019_TRIP_SmallInsurer_Report.pdf">https://home.treasury.gov/system/files/311/2019_TRIP_SmallInsurer_Report.pdf</a>.
\6\ U.S. Treasury, Study of Small Insurer Competitiveness in the
Terrorism Risk Insurance Marketplace (June 2021), <a href="https://home.treasury.gov/system/files/311/2021TRIPSmallInsurerReportJune2021.pdf">https://home.treasury.gov/system/files/311/2021TRIPSmallInsurerReportJune2021.pdf</a>.
\7\ U.S. Treasury, Study of Small Insurer Competitiveness in the
Terrorism Risk Insurance Marketplace (June 2023), <a href="https://home.treasury.gov/system/files/311/2023%20TRIP%20Small%20Insurer%20Report%20FINAL.pdf">https://home.treasury.gov/system/files/311/2023%20TRIP%20Small%20Insurer%20Report%20FINAL.pdf</a>.
Steven E. Seitz,
Director, Federal Insurance Office.
[FR Doc. 2025-05580 Filed 4-1-25; 8:45 am]
BILLING CODE 4810-AK-P
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