II 

108TH CONGRESS 

2D SESSION S. 2764

To extend the applicability of the Terrorism Risk Insurance Act of 2002. 

IN THE SENATE OF THE UNITED STATES 

JULY 22, 2004

Mr. DODD (for himself, Mr. BENNETT, Mr. SCHUMER, Mr. HAGEL, Mr. 

REED, Mr. BUNNING, Mr. CARPER, Mr. CRAPO, Mr. REID, Mrs. DOLE, 

Mr. NELSON of Nebraska, and Mr. CHAFEE) introduced the following 

bill; which was read twice and referred to the Committee on Banking, 

Housing, and Urban Affairs 

A BILL

To extend the applicability of the Terrorism Risk Insurance 

Act of 2002.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Terrorism Risk Insur5 ance Extension Act of 2004’’. 

6 SEC. 2. EXTENSION OF TERRORISM RISK INSURANCE PRO7 GRAM. 

8 (a) EXTENSION OF PROGRAM YEARS.—Section 

9 108(a) of the Terrorism Risk Insurance Act of 2002 (15 
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1 U.S.C. 6701 note, 116 Stat. 2336) is amended by striking 

2 ‘‘2005’’ and inserting ‘‘2007’’. 

3 (b) CONTINUING AUTHORITY OF THE SECRETARY.—

4 Section 108(b) of the Terrorism Risk Insurance Act of 

5 2002 (15 U.S.C. 6701 note, 116 Stat. 2336) is amended 

6 by striking ‘‘arising out of’’ and all that follows through 

7 ‘‘this title’’. 

8 SEC. 3. CONFORMING AMENDMENTS. 

9 (a) DEFINITIONS.—

10 (1) PROGRAM YEARS.—Section 102(11) of the 

11 Terrorism Risk Insurance Act of 2002 (15 U.S.C. 

12 6701 note, 116 Stat. 2326) is amended by adding 

13 at the end the following: 

14 ‘‘(E) PROGRAM YEAR 4.—The term ‘Pro15 gram Year 4’ means the period beginning on 

16 January 1, 2006 and ending on December 31, 

17 2006. 

18 ‘‘(F) PROGRAM YEAR 5.—The term ‘Pro19 gram Year 5’ means the period beginning on 

20 January 1, 2007 and ending on December 31, 

21 2007. 

22 ‘‘(G) OTHER PROGRAM YEARS.—Except 

23 when used as provided in subparagraphs (B) 

24 through (F), the term ‘Program Year’ means, 

25 as the context requires, any of Program Year 1, 
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1 Program Year 2, Program Year 3, Program 

2 Year 4, or Program Year 5.’’. 

3 (2) INSURED LOSSES.—Section 102(5) of the 

4 Terrorism Risk Insurance Act of 2002 (15 U.S.C. 

5 6701 note, 116 Stat. 2324) is amended—

6 (A) by inserting ‘‘on or before December 

7 31, 2007, as required by this title,’’ before ‘‘if 

8 such loss’’; 

9 (B) by striking ‘‘(A) occurs within’’ and 

10 inserting the following: 

11 ‘‘(A) occurs on or before the earlier of the 

12 expiration date of the insurance policy or De13 cember 31, 2008; and 

14 ‘‘(B) occurs—

15 ‘‘(i) within’’; and 

16 (C) by striking ‘‘occurs to an air carrier’’ 

17 and inserting the following: 

18 ‘‘(ii) to an air carrier’’. 

19 (3) CONFORMING AMENDMENTS.—Section 102 

20 of the Terrorism Risk Insurance Act of 2002 (15 

21 U.S.C. 6701 note, 116 Stat. 2323) is amended—

22 (A) in paragraph (1)(A)(iii)(I), by striking 

23 ‘‘(5)(B)’’ and inserting ‘‘(5)(B)(ii)’’; and 
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1 (B) in paragraph (4), by striking ‘‘sub2 paragraphs (A) and (B)’’ and inserting ‘‘sub3 paragraph (B)’’. 

4 (b) APPLICABLE INSURER DEDUCTIBLES.—Section 

5 102(7) of the Terrorism Risk Insurance Act of 2002 (15 

6 U.S.C. 6701 note, 116 Stat. 2325) is amended—

7 (1) in subparagraph (D)—

8 (A) by inserting ‘‘and each Program Year 

9 thereafter’’ before ‘‘, the value’’; and 

10 (B) by striking ‘‘preceding Program Year 

11 3’’ and inserting ‘‘preceding that Program 

12 Year’’; and 

13 (2) in subparagraph (E), by striking ‘‘for the 

14 Transition’’ and all that follows through ‘‘Program 

15 Year 3’’ and inserting the following: ‘‘for the Transi16 tion Period or any Program Year’’. 

17 (c) CONTINUATION OF MANDATORY AVAILABILITY.—

18 Section 103(c)(1) of the Terrorism Risk Insurance Act of 

19 2002 (15 U.S.C. 6701 note, 116 Stat. 2327) is amend20 ed—

21 (1) by striking ‘‘last day of Program Year 2’’ 

22 and inserting ‘‘termination date established under 

23 section 108(a)’’; and 

24 (2) by striking the paragraph heading and in25 serting ‘‘IN GENERAL.—’’.
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1 (d) DURATION OF POLICIES.—Section 103(c) of the 

2 Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 

3 note, 116 Stat. 2327) is amended—

4 (1) by redesignating paragraph (2) as para5 graph (3); and 

6 (2) by inserting after paragraph (1) the fol7 lowing: 

8 ‘‘(2) MANDATORY DURATION.—Coverage for in9 sured losses required by paragraph (1) under a pol10 icy issued at any time during Program Year 5 shall 

11 remain in effect for not less than 1 year following 

12 the date of issuance of the policy, except that no loss 

13 occurring after the earlier of the expiration date of 

14 the subject insurance policy or December 31, 2008, 

15 shall be considered to be an insured loss for pur16 poses of this title.’’. 

17 (e) INSURED LOSS SHARED COMPENSATION.—Sec18 tion 103(e) of the Terrorism Risk Insurance Act of 2002 

19 (15 U.S.C. 6701 note, 116 Stat. 2328) is amended—

20 (1) in paragraph (2)(A), by striking ‘‘ending 

21 on’’ and all that follows through ‘‘Program Year 3’’ 

22 and inserting ‘‘ending on the termination date estab23 lished under section 108(a)’’; and 

24 (2) in paragraph (3), by striking ‘‘ending on’’ 

25 and all that follows through ‘‘Program Year 3’’ and 
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1 inserting ‘‘ending on the termination date estab2 lished under section 108(a)’’. 

3 (f) AGGREGATE RETENTION AMOUNT.—Section 

4 103(e)(6) of the Terrorism Risk Insurance Act of 2002 

5 (15 U.S.C. 6701 note, 116 Stat. 2328) is amended—

6 (1) in subparagraph (B), by striking ‘‘and’’ at 

7 the end; 

8 (2) in subparagraph (C), by striking the period 

9 at the end and inserting a semicolon; and 

10 (3) by adding at the end the following: 

11 ‘‘(D) for Program Year 4, the lesser of—

12 ‘‘(i) $17,500,000,000; and 

13 ‘‘(ii) the aggregate amount, for all in14 surers, of insured losses during such Pro15 gram Year; and 

16 ‘‘(E) for Program Year 5, the lesser of—

17 ‘‘(i) $20,000,000,000; and 

18 ‘‘(ii) the aggregate amount, for all in19 surers, of insured losses during such Pro20 gram Year.’’. 

21 SEC. 4. COVERAGE OF GROUP LIFE INSURANCE. 

22 Section 103 of the Terrorism Risk Insurance Act of 

23 2002 (15 U.S.C. 6701 note, 116 Stat. 2327) is amended 

24 by striking subsection (h) and inserting the following: 

25 ‘‘(h) APPLICABILITY TO GROUP LIFE INSURANCE.—
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1 ‘‘(1) IN GENERAL.—The Secretary shall, by 

2 rule, apply the provisions of this title to providers of 

3 group life insurance, in the manner determined ap4 propriate by the Secretary, consistent with the pur5 poses of this title. 

6 ‘‘(2) CONSISTENT APPLICATION.—The rules of 

7 the Secretary under this subsection shall, to the ex8 tent practicable, apply the provisions of this title to 

9 providers of group life insurance in a similar manner 

10 as those provisions apply to an insurer otherwise 

11 under this title. 

12 ‘‘(3) CONSIDERATIONS.—In determining the ap13 plicability of this title to providers of group life in14 surance, and the manner of such application, the 

15 Secretary shall consider the overall group life insur16 ance market size, and shall consider the establish17 ment of separate retention amounts for such pro18 viders. 

19 ‘‘(4) RULEMAKING REQUIRED.—Not later than 

20 90 days after the date of enactment of the Ter21 rorism Risk Insurance Extension Act of 2004, the 

22 Secretary shall issue final regulations to carry out 

23 this subsection. 

24 ‘‘(5) RULE OF CONSTRUCTION.—Nothing in 

25 this subsection may be construed to affect or other-
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1 wise alter the applicability of this title to any in2 surer, as defined in section 102. 

3 ‘‘(6) DEFINITION.—As used in this subsection, 

4 the term ‘group life insurance’ means an insurance 

5 contract that provides term life insurance coverage, 

6 accidental death coverage, or a combination thereof, 

7 for a number of persons under a single contract, on 

8 the basis of a group selection of risks.’’. 

9 SEC. 5. RECOMMENDATIONS FOR LONG-TERM SOLUTIONS. 

10 Section 108 of the Terrorism Risk Insurance Act of 

11 2002 (15 U.S.C. 6701 note, 116 Stat. 2328) is amended 

12 by adding at the end the following: 

13 ‘‘(e) RECOMMENDATIONS FOR LONG-TERM SOLU14 TIONS.—The Presidential Working Group on Financial 

15 Markets shall, in consultation with the NAIC, representa16 tives of the insurance industry, and representatives of pol17 icy holders, not later than June 30, 2006, submit a report 

18 to Congress containing recommendations for legislation to 

19 address the long-term availability and affordability of in20 surance for terrorism risk.’’.

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