I 

108TH CONGRESS 

2D SESSION H. R. 4634

To extend the terrorism insurance program of the Department of the 

Treasury. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 22, 2004

Mr. SESSIONS (for himself, Mr. BAKER, Mrs. KELLY, Mr. CANTOR, and Ms. 

PRYCE of Ohio) introduced the following bill; which was referred to the 

Committee on Financial Services 

A BILL

To extend the terrorism insurance program of the 

Department of the Treasury.

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 Insurance 

5 Backstop Extension Act of 2004’’. 

6 SEC. 2. EXTENSION OF TERRORISM INSURANCE PROGRAM. 

7 (a) PROGRAM YEARS 4 AND 5.—Paragraph (11) of 

8 section 102 of the Terrorism Risk Insurance Act of 2002 

9 (15 U.S.C. 6701 note) is amended by adding at the end 

10 the following new subparagraphs: 
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1 ‘‘(E) PROGRAM YEAR 4.—The term ‘Pro2 gram Year 4’ means the period beginning on 

3 January 1, 2006 and ending on December 31, 

4 2006. 

5 ‘‘(F) PROGRAM YEAR 5.—The term ‘Pro6 gram Year 5’ means the period beginning on 

7 January 1, 2007 and ending on December 31, 

8 2007.’’. 

9 (b) INSURER DEDUCTIBLE.—Paragraph (7) of sec10 tion 102 of the Terrorism Risk Insurance Act of 2002 (15 

11 U.S.C. 6701 note) is amended—

12 (1) by redesignating subparagraph (E) as sub13 paragraph (G); 

14 (2) in subparagraph (D), by striking ‘‘and’’ at 

15 the end; 

16 (3) by inserting after subparagraph (D) the fol17 lowing new subparagraphs: 

18 ‘‘(E) for Program Year 4, the value of an 

19 insurer’s direct earned premiums over the cal20 endar year immediately preceding Program 

21 Year 4, multiplied by 15 percent; 

22 ‘‘(F) for Program Year 5, the value of an 

23 insurer’s direct earned premiums over the cal24 endar year immediately preceding Program 

25 Year 4, multiplied by 20 percent; and’’; and 
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1 (4) in subparagraph (G) (as so redesignated by 

2 paragraph (1) of this subsection)—

3 (A) by striking ‘‘(D)’’ and inserting ‘‘(F)’’; 

4 and 

5 (B) by striking ‘‘or Program Year 3’’ and 

6 inserting ‘‘Program Year 3, Program Year 4, or 

7 Program Year 5’’. 

8 (c) MANDATORY AVAILABILITY.—Subsection (c) of 

9 section 103 of the Terrorism Risk Insurance Act of 2002 

10 (15 U.S.C. 6701 note) is amended—

11 (1) by striking all of the matter that precedes 

12 subparagraph (A) of paragraph (1) and inserting the 

13 following: 

14 ‘‘(c) MANDATORY AVAILABILITY.—During the Pro15 gram, each entity that meets the definition of an insurer 

16 under section 102—’’; 

17 (2) by striking paragraph (2); and 

18 (3) by redesignating subparagraphs (A) and 

19 (B) as paragraphs (1) and (2) and realigning such 

20 paragraphs, as so redesignated, so as to be indented 

21 2 ems from the left margin. 

22 (d) INSURED LOSS SHARED COMPENSATION.—Sub23 section (e) of section 103 of the Terrorism Risk Insurance 

24 Act of 2002 (15 U.S.C. 6701 note) is amended—
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1 (1) in paragraph (2)(A), by striking ‘‘or Pro2 gram Year 3’’ and inserting ‘‘, Program Year 3, 

3 Program Year 4, or Program Year 5’’; 

4 (2) in paragraph (3), by striking ‘‘or Program 

5 Year 3’’ and inserting ‘‘, Program Year 3, Program 

6 Year 4, or Program Year 5’’; 

7 (3) in paragraph (6)—

8 (A) in subparagraph (B), by striking 

9 ‘‘and’’ at the end; 

10 (B) in subparagraph (C) by striking the 

11 period at the end and inserting a semicolon; 

12 and 

13 (C) by adding at the end the following new 

14 subparagraphs: 

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

16 ‘‘(i) $17,500,000,000; and 

17 ‘‘(ii) the aggregate amount, for all in18 surers, of insured losses during such Pro19 gram Year; and 

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

21 ‘‘(i) $20,000,000,000; and 

22 ‘‘(ii) the aggregate amount, for all in23 surers, of insured losses during such Pro24 gram Year.’’; and 

25 (4) in paragraph (7)—
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1 (A) in subparagraph (A), by striking ‘‘and 

2 (C)’’ and inserting ‘‘(C), (D), and (E)’’; and 

3 (B) in subparagraphs (B) and (C), by 

4 striking ‘‘or (C)’’ each place such term appears 

5 and inserting ‘‘(C), (D), or (E)’’. 

6 (e) GROUP LIFE INSURANCE DETERMINATION.—

7 Subsection (h) of section 103 of the Terrorism Risk Insur8 ance Act of 2002 (15 U.S.C. 6701 note) is amended—

9 (1) in paragraph (2)(B), by striking ‘‘the study 

10 under paragraph (1)’’ and inserting ‘‘paragraphs (1) 

11 and (2)’’; 

12 (2) by redesignating paragraph (2) as para13 graph (3); and 

14 (3) by inserting after paragraph (1) the fol15 lowing new paragraph: 

16 ‘‘(2) DETERMINATION.—By June 1, 2005, the 

17 Secretary shall—

18 ‘‘(A) submit a report to the Congress on 

19 conditions and developments in the market for 

20 group life insurance since the determination 

21 that was announced by the Secretary on August 

22 15, 2003, and made pursuant to this subsection 

23 (as in effect on such date); and 

24 ‘‘(B) make a final determination as to the 

25 availability of group life insurance to both in-
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1 surers and consumers and whether the provi2 sions of this title shall be applied, pursuant to 

3 paragraph (3), to providers of group life insur4 ance.’’. 

5 (f) STUDY ON LONG-TERM SOLUTIONS.—Section 

6 103 of the Terrorism Risk Insurance Act of 2002 (15 

7 U.S.C. 6701 note) is amended by striking subsection (i) 

8 and inserting the following new subsection: 

9 ‘‘(i) STUDY ON LONG-TERM SOLUTIONS.—By June 

10 1, 2005, the Secretary shall conduct a study and submit 

11 a report to the Congress on alternatives for expanding the 

12 availability and affordability of terrorism insurance after 

13 the termination of the Program that do not involve a Fed14 eral financial backstop.’’. 

15 (g) TERMINATION OF PROGRAM.—Subsection (a) of 

16 section 108 of the Terrorism Risk Insurance Act of 2002 

17 (15 U.S.C. 6701 note) is amended by striking ‘‘December 

18 31, 2005’’ and inserting ‘‘December 31, 2007’’.

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