11460 Federal Register / Vol. 71, No. 44 / Tuesday, March 7, 2006 / Notices 

1The President’s Working Group on Financial 

Markets (established by Executive Order 12631) is 

comprised of the Secretary of the Treasury (who 

serves as its Chairman), the Chairman of the Federal 

Reserve Board, the Chairman of the Securities and 

Exchange Commission, and the Chairman of the 

Commodity Futures Trading Commission. 

Maritime Administration, MAR–830, 

Room 7201, 400 Seventh St., SW., 

Washington, DC 20590; 

richard.lolich@dot.gov. 

(Authority: 5 U.S.C. App 2, Sec. 9(a)(2); 41 

CFR 101–6. 1005; DOT Order 1120.3B) 

Dated: March 1, 2006. 

Joel C. Richard, 

Secretary, Maritime Administration. 

[FR Doc. E6–3151 Filed 3–6–06; 8:45 am] 

BILLING CODE 4910–81–P 

DEPARTMENT OF THE TREASURY 

Analysis by the President’s Working 

Group on Financial Markets on the 

Long-Term Availability and 

Affordability of Insurance for Terrorism 

Risk 

AGENCY: Department of the Treasury, 

Departmental Offices. 

ACTION: Notice; request for comments. 

SUMMARY: The Terrorism Risk Insurance 

Extension Act of 2005 requires the 

President’s Working Group on Financial 

Markets to perform an analysis 

regarding the long-term availability and 

affordability of insurance for terrorism 

risk, including group life coverage and 

coverage for chemical, nuclear, 

biological, and radiological events. 

As chair of the President’s Working 

Group, Treasury is issuing this notice 

seeking public comment to assist the 

President’s Working Group in its 

analysis. 

DATES: Comments must be in writing 

and received by April 21, 2006. 

ADDRESSES: Please submit comments (if 

hard copy, preferably an original and 

two copies) to Treasury’s Office of 

Financial Institutions Policy, Attention: 

President’s Working Group on Financial 

Markets Public Comment Record, Room 

3160 Annex, Department of the 

Treasury, 1500 Pennsylvania Avenue, 

NW., Washington, DC 20220. Because 

postal mail may be subject to processing 

delay, we recommend that comments be 

submitted by electronic mail to: 

PWGComments@do.treas.gov. All 

comments should be captioned with 

‘‘President’s Working Group on 

Financial Markets: Terrorism Risk 

Insurance Analysis.’’ Please include 

your name, affiliation, address, e-mail 

address and telephone number(s) in 

your comment. Where appropriate, 

comments should include a short 

Executive Summary (no more than five 

single-spaced pages). All comments 

received will be available for public 

inspection by appointment only at the 

Reading Room of the Treasury Library. 

To make appointments, please call one 

of the numbers below. 

FOR FURTHER INFORMATION CONTACT: C. 

Christopher Ledoux, Senior Policy 

Analyst, Office of Financial Institutions 

Policy, 202–622–6813; or Mario 

Ugoletti, Director, Office of Financial 

Institutions Policy, 202–622–2730 (not 

toll free numbers). 

SUPPLEMENTARY INFORMATION: On 

November 26, 2002, the President 

signed into law the Terrorism Risk 

Insurance Act of 2002 (Pub. L. 107–297, 

116 Stat. 2322) (hereinafter referenced 

as ‘‘TRIA’’). TRIA’s purposes are to 

address market disruptions, ensure the 

continued widespread availability and 

affordability of commercial property 

and casualty insurance for terrorism 

risk, and to allow for a transition period 

for the private markets to stabilize and 

build capacity while preserving state 

insurance regulation and consumer 

protections. Title I of TRIA established 

a temporary Federal program of shared 

public and private compensation for 

insured commercial property and 

casualty losses resulting from an act of 

terrorism, as defined in the Act. TRIA 

authorized Treasury to administer and 

implement the Terrorism Risk Insurance 

Program (Program), including the 

issuance of regulations and procedures. 

As originally enacted, the Program was 

to end on December 31, 2005. 

Congress subsequently approved and 

on December 22, 2005, the President 

signed into law the Terrorism Risk 

Insurance Extension Act of 2005 (Pub. 

L. 109–144, 119 Stat. 2660) (the 

Extension Act). The Extension Act 

continued the Program for two years 

until December 31, 2007, revised several 

structural aspects of the Program, and 

required an analysis of the availability 

and affordability of terrorism risk 

insurance. Specifically, the Extension 

Act amended section 108 of TRIA to 

require the President’s Working Group 

on Financial Markets,1 in consultation 

with the National Association of 

Insurance Commissioners, 

representatives of the insurance 

industry, representatives of the 

securities industry, and representatives 

of policy holders, to perform an analysis 

regarding the long-term availability and 

affordability of insurance for terrorism 

risk, including group life coverage and 

coverage for chemical, nuclear, 

biological, and radiological events. This 

Notice seeks comment from these and 

any other interested parties as a means 

of satisfying the consultation 

requirement in the most open and 

efficient manner. TRIA, as amended by 

the Extension Act, requires the 

President’s Working Group on Financial 

Markets to submit a report to Congress 

on its findings no later than September 

30, 2006. 

Treasury, on behalf of the President’s 

Working Group, is soliciting comments, 

including empirical data and other 

information in support of such 

comments, where appropriate and 

available, regarding the long-term 

availability and affordability of 

insurance for terrorism risk, including 

terrorism risk insurance coverage for 

group life and for chemical, nuclear, 

biological, and radiological events. We 

request that submitters distinguish 

between risk from foreign and domestic 

terrorism in their comments. In 

addition, we seek and solicit comment 

in response to the following specific 

questions: 

I. Long-Term Availability and 

Affordability of Terrorism Risk 

Insurance 

1.1 In the long-term, what are the 

key factors that will determine the 

availability and affordability of 

terrorism risk insurance coverage? How 

can these factors be measured and 

projected? 

1.2 What improvements have taken 

place in the ability of insurers to 

measure and manage their accumulation 

of terrorism risk exposures? How will 

this evolve in the long-term? 

1.3 What improvements have taken 

place in the ability of insurers to price 

terrorism risk insurance, including in 

the development and use of modeling? 

How will this evolve in the long-term? 

1.4 How, if at all, were primary 

insurers’ pricing decisions affected by 

the anticipated expiration of TRIA at the 

end of 2005, particularly for insurance 

policies extending into 2006 that cover 

terrorism risk? What role did the pricing 

and availability of reinsurance play in 

those decisions? 

1.5 What role do mitigation efforts 

related to terrorism risk play in an 

insurer’s underwriting and pricing 

decisions? How will this evolve in the 

long-term? 

1.6 What is the current availability 

of reinsurance to cover terrorism risk? 

Please distinguish by line or type of 

insurance being reinsured and on what 

basis (treaty or facultative). How will 

this evolve in the long-term? 

1.7 At what policyholder retention 

levels are insurance programs being 

structured to cover terrorism risk; and, 

with regard to insurers, how are 


sroberts on PROD1PC70 with NOTICES
Federal Register / Vol. 71, No. 44 / Tuesday, March 7, 2006 / Notices 11461 

2Though CNBR is commonly used to refer 

collectively to chemical, nuclear, biological, and 

radiological losses, comments can be narrow in 

addressing any of the coverages. If the comment 

makes such a distinction, please make clear which 

coverage is being addressed. 

reinsurance programs likewise being 

structured? Please comment on the 

availability and affordability at each 

level. 

1.8 In the long-term, what are the 

key factors that will determine the 

amount of private-market insurer and 

reinsurer capacity available for 

terrorism risk insurance coverage? How 

will this evolve in the long-term? Please 

comment on potential entry of new 

capital into insurance markets. 

1.9 To what extent have alternate 

risk transfer methods (e.g., catastrophe 

bonds or other capital market 

instruments) been used for terrorism 

risk insurance, and what is the potential 

for the long-term development of these 

products? 

1.10 To what extent have captive 

insurance companies been used for 

terrorism risk insurance, and what is the 

potential for the use of captive insurers 

to insure against such risk long-term? 

1.11 Have state approaches made 

coverage more or less available and 

affordable, such as through permitted 

exclusions and rate regulation? To what 

extent will the long-term availability 

and affordability of terrorism risk 

insurance be influenced by state 

insurance regulation? Please comment 

on state approaches to ensure the 

continued availability and affordability 

of terrorism risk insurance in the 

absence of the TRIA Program being inplace (include state approaches after 

September 11, 2001 and before TRIA 

became law on November 24, 2002, as 

well as state approaches in preparation 

for the expiration of the TRIA Program). 

1.12 What are the differences in 

availability and affordability of 

terrorism risk insurance between the 

licensed/admitted market and the nonadmitted/surplus lines market, and, if 

so, to what degree are those changes 

attributable to the degree and manner in 

which each market is regulated? 

1.13 What are the differences in 

availability and affordability of 

terrorism risk insurance coverage for 

losses at U.S. locations as compared to 

such coverage for losses at non-US 

locations? 

II. Long-Term Availability and 

Affordability of Group Life Insurance 

Coverage 

2.1 What impact, if any, does 

terrorism risk have on the availability 

and affordability of group life insurance 

coverage to the policy holder (e.g., 

employer) and certificate holders (e.g., 

employees)? How will this evolve in the 

long-term? 

2.2 To what extent is an insurer’s 

decision to issue group life coverage 

influenced by aggregation or 

accumulation risk in certain locations? 

What steps have group life insurance 

providers taken or do they plan to take 

to offset any aggregation or 

accumulation risk? 

2.3 Has terrorism risk made group 

life coverage less affordable to the 

policy or certificate holder? Have group 

life insurance rates increased or 

decreased as compared to rates before 

and since September 11, 2001? 

2.4 Please explain how group life 

insurance coverage may be bundled 

with other coverages and benefits 

provided through an employee-benefits 

program, and how group life coverage is 

priced, either separately or collectively, 

through such programs. Please describe 

any effects competition has on such 

pricing. 

2.5 Are group life providers 

voluntarily providing coverage for loss 

of life arising out of or resulting from 

acts of terrorism, or is coverage 

mandated by any state or federal laws? 

Are group life providers prohibited by 

law from excluding terrorism risk from 

group life insurance policies? 

2.6 Has terrorism risk affected 

segments of the group life market 

differently, such as in the case of small/ 

medium sized employers, and if so, 

why? 

2.7 In the long-term, what are the 

key factors that will determine the 

availability and affordability of 

terrorism risk insurance coverage for 

group life insurance? 

III. Long-Term Availability and 

Affordability of Insurance Coverage for 

Chemical, Nuclear, Biological, and 

Radiological (CNBR) 2 Events Caused by 

Terrorism 

3.1 What is the current availability 

and affordability of coverage for CNBR 

events, and for what perils is coverage 

available, subject to what limits, and 

under what policy terms and 

conditions? Is there a difference in the 

availability and affordability of coverage 

for CNBR events caused by acts of 

terrorism? 

3.2 What was the general availability 

of coverage for CNBR events prior to the 

terrorist attack of September 11, 2001? 

To what extent, subject to what limits, 

and for what perils was coverage 

available? Did it cover acts of terrorism? 

3.3 If coverage for CNBR events 

caused by acts of terrorism is available, 

please describe generally to what extent 

(i.e., limits, locations, exclusions, etc.) 

for what kinds of insurance and from 

what types of insurers (i.e., large/small, 

admitted/surplus lines, etc.). How will 

this evolve in the long-term? 

3.4 To what extent is terrorism risk 

coverage available and affordable for 

nuclear facilities and for chemical 

plants, manufacturers, and industrial 

chemical users? 

3.5 To what extent, both prior to and 

since September 11, 2001, have various 

states allowed insurers to exclude 

coverage for CNBR events? Please 

comment on requirements for workers’

compensation and fire-following 

coverage. 

3.6 It appears that some insurers are 

unwilling to provide coverage for CNBR 

events caused by acts of terrorism even 

with the federal loss sharing provided 

by the TRIA Program. Why would this 

be the case given that TRIA limits an 

insurer’s maximum loss exposure? 

3.7 In the long-term, what are the 

key factors that will determine the 

availability and affordability of 

terrorism risk insurance coverage for 

CNBR events? 

Dated: February 27, 2006. 

Emil W. Henry, Jr., 

Assistant Secretary of the Treasury. 

[FR Doc. E6–3150 Filed 3–6–06; 8:45 am] 

BILLING CODE 4811–37–P 

DEPARTMENT OF VETERANS 

AFFAIRS 

Veterans’ Disability Benefits 

Commission; Amendment Notice of 

Meeting (FR Doc. 06–1514 Filed 2–16–

06; 8:45 a.m.) 

The Department of Veterans Affairs 

(VA) gives notice under Public Law 92–

463 (Federal Advisory Committee Act) 

that the Veterans’ Disability Benefits 

Commission meeting scheduled on 

March 16–17, 2006, at the Holiday Inn 

National Airport, 2650 Jefferson Davis 

Highway, Arlington, VA, will begin 

each day at 8 a.m. instead of 8:30 a.m. 

to allow more time for Commission 

discussion. 

For additional information, please 

contact Mr. Ray Wilburn, Executive 

Director, Veterans’ Disability Benefits 

Commission, 1101 Pennsylvania 

Avenue, NW., 5th Floor, Washington, 

DC 20004, or by e-mail at veterans@vets

commission.intranets.com. 

Dated: February 27, 2006. 

By Direction of the Secretary. 

E. Philip Riggin, 

Committee Management Officer. 

[FR Doc. 06–2109 Filed 3–6–06; 8:45 am] 

BILLING CODE 8320–01–M 


sroberts on PROD1PC70 with NOTICES