In the Senate of the United States,

December 16, 2005.

Resolved, That the Senate agree to the amendment of

the House of Representatives to the bill (S. 467) entitled ‘‘An

Act to extend the applicability of the Terrorism Risk Insurance Act of 2002.’’, with the following

SENATE AMENDMENT TO HOUSE AMENDMENT:

In lieu of the matter proposed to be inserted by the

House amendment to the text of the bill, insert:

1 SECTION 1. SHORT TITLE.

2 This Act may be cited as the ‘‘Terrorism Risk Insur3 ance Extension Act of 2005’’.

4 SEC. 2. EXTENSION OF TERRORISM RISK INSURANCE PRO5 GRAM.

6 (a) PROGRAM EXTENSION.—Section 108(a) of the Ter7 rorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note;

8 116 Stat. 2336) is amended by striking ‘‘2005’’ and insert9 ing ‘‘2007’’.
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1 (b) MANDATORY AVAILABILITY.—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 striking paragraph (2);

5 (2) by striking ‘‘AVAILABILITY.—’’ and all that

6 follows through ‘‘each entity’’ and inserting ‘‘AVAIL7 ABILITY.—During each Program Year, each entity’’;

8 and

9 (3) by redesignating subparagraphs (A) and (B)

10 as paragraphs (1) and (2), respectively, and moving

11 the margins 2 ems to the left.

12 SEC. 3. AMENDMENTS TO DEFINED TERMS.

13 (a) PROGRAM YEARS.—Section 102(11) of the Ter14 rorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note;

15 116 Stat. 2326) is amended by adding at the end the fol16 lowing:

17 ‘‘(E) PROGRAM YEAR 4.—The term ‘Pro18 gram Year 4’ means the period beginning on

19 January 1, 2006 and ending on December 31,

20 2006.

21 ‘‘(F) PROGRAM YEAR 5.—The term ‘Pro22 gram Year 5’ means the period beginning on

23 January 1, 2007 and ending on December 31,

24 2007.’’.

25 (b) EXCLUSIONS FROM COVERED LINES.—
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1 (1) IN GENERAL.—Section 102(12)(B) of the Ter2 rorism Risk Insurance Act of 2002 (15 U.S.C. 6701

3 note; 116 Stat. 2326) is amended—

4 (A) in clause (vi), by striking ‘‘or’’ at the

5 end;

6 (B) in clause (vii), by striking the period at

7 the end and inserting a semicolon; and

8 (C) by adding at the end the following:

9 ‘‘(viii) commercial automobile insur10 ance;

11 ‘‘(ix) burglary and theft insurance;

12 ‘‘(x) surety insurance;

13 ‘‘(xi) professional liability insurance;

14 or

15 ‘‘(xii) farm owners multiple peril in16 surance.’’.

17 (2) CONFORMING AMENDMENT.—Section

18 102(12)(A) of the Terrorism Risk Insurance Act of

19 2002 (15 U.S.C. 6701 note; 116 Stat. 2326) is amend20 ed by striking ‘‘surety insurance’’ and inserting ‘‘di21 rectors and officers liability insurance’’.

22 (c) INSURER DEDUCTIBLES.—Section 102(7) of the

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

24 note; 116 Stat. 2325) is amended—
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1 (1) in subparagraph (D), by striking ‘‘and’’ at

2 the end;

3 (2) by redesignating subparagraph (E) as sub4 paragraph (G);

5 (3) by inserting after subparagraph (D), the fol6 lowing:

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

8 insurer’s direct earned premiums over the cal9 endar year immediately preceding Program Year

10 4, multiplied by 17.5 percent;

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

12 insurer’s direct earned premiums over the cal13 endar year immediately preceding Program Year

14 5, multiplied by 20 percent; and’’; and

15 (4) in subparagraph (G), as so redesignated, by

16 striking ‘‘through (D)’’ and all that follows through

17 ‘‘Year 3’’and inserting the following: ‘‘through (F), for

18 the Transition Period or any Program Year’’.

19 SEC. 4. INSURED LOSS SHARED COMPENSATION.

20 Section 103(e) of the Terrorism Risk Insurance Act of

21 2002 (15 U.S.C. 6701 note; 116 Stat. 2328) is amended—

22 (1) in paragraph (1)—

23 (A) by inserting ‘‘through Program Year 4’’

24 before ‘‘shall be equal’’; and
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1 (B) by inserting ‘‘, and during Program

2 Year 5 shall be equal to 85 percent,’’ after ‘‘90

3 percent’’; and

4 (2) in each of paragraphs (2) and (3), by strik5 ing ‘‘Program Year 2 or Program Year 3’’ each place

6 that term appears and inserting ‘‘any of Program

7 Years 2 through 5’’.

8 SEC. 5. AGGREGATE RETENTION AMOUNTS AND

9 RECOUPMENT OF FEDERAL SHARE.

10 (a) AGGREGATE RETENTION AMOUNTS.—Section

11 103(e)(6) of the Terrorism Risk Insurance Act of 2002 (15

12 U.S.C. 6701 note; 116 Stat. 2329) is amended—

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

14 the end;

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

16 at the end and inserting a semicolon; and

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

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

19 ‘‘(i) $25,000,000,000; and

20 ‘‘(ii) the aggregate amount, for all in21 surers, of insured losses during such Pro22 gram Year; and

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

24 ‘‘(i) $27,500,000,000; and
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1 ‘‘(ii) the aggregate amount, for all in2 surers, of insured losses during such Pro3 gram Year.’’.

4 (b) RECOUPMENT OF FEDERAL SHARE.—Section

5 103(e)(7) of the Terrorism Risk Insurance Act of 2002 (15

6 U.S.C. 6701 note; 116 Stat. 2329) is amended—

7 (1) in subparagraph (A), by striking ‘‘, (B), and

8 (C)’’ and inserting ‘‘through (E)’’; and

9 (2) in each of subparagraphs (B) and (C), by

10 striking ‘‘subparagraph (A), (B), or (C)’’ each place

11 that term appears and inserting ‘‘any of subpara12 graphs (A) through (E)’’.

13 SEC. 6. PROGRAM TRIGGER.

14 Section 103(e)(1) of the Terrorism Risk Insurance Act

15 of 2002 (15 U.S.C. note, 116 Stat. 2328) is amended—

16 (1) by redesignating subparagraph (B) as sub17 paragraph (C); and

18 (2) by inserting after subparagraph (A) the fol19 lowing:

20 ‘‘(B) PROGRAM TRIGGER.—In the case of a

21 certified act of terrorism occurring after March

22 31, 2006, no compensation shall be paid by the

23 Secretary under subsection (a), unless the aggre24 gate industry insured losses resulting from such

25 certified act of terrorism exceed—
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1 ‘‘(i) $50,000,000, with respect to such

2 insured losses occurring in Program Year 4;

3 or

4 ‘‘(ii) $100,000,000, with respect to such

5 insured losses occurring in Program Year

6 5.’’.

7 SEC. 7. LITIGATION MANAGEMENT.

8 Section 107(a) of the Terrorism Risk Insurance Act

9 of 2002 (15 U.S.C. 6701 note; 116 Stat. 2335) is amended

10 by adding at the end the following:

11 ‘‘(6) AUTHORITY OF THE SECRETARY.—Proce12 dures and requirements established by the Secretary

13 under section 50.82 of part 50 of title 31 of the Code

14 of Federal Regulations (as in effect on the date of

15 issuance of that section in final form) shall apply to

16 any cause of action described in paragraph (1) of this

17 subsection.’’.

18 SEC. 8. ANALYSIS AND REPORT ON TERRORISM RISK COV19 ERAGE CONDITIONS AND SOLUTIONS.

20 Section 108 of the Terrorism Risk Insurance Act of

21 2002 (15 U.S.C. 6701 note; 116 Stat. 2336) is amended

22 by adding at the end the following:

23 ‘‘(e) ANALYSIS OF MARKET CONDITIONS FOR TER24 RORISM RISK INSURANCE.—
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1 ‘‘(1) IN GENERAL.—The President’s Working

2 Group on Financial Markets, in consultation with the

3 National Association of Insurance Commissioners,

4 representatives of the insurance industry, representa5 tives of the securities industry, and representatives of

6 policy holders, shall perform an analysis regarding

7 the long-term availability and affordability of insur8 ance for terrorism risk, including—

9 ‘‘(A) group life coverage; and

10 ‘‘(B) coverage for chemical, nuclear, biologi11 cal, and radiological events.

12 ‘‘(2) REPORT.—Not later than September 30,

13 2006, the President’s Working Group on Financial

14 Markets shall submit a report to the Committee on

15 Banking, Housing, and Urban Affairs of the Senate

16 and the Committee on Financial Services of the

17 House of Representatives on its findings pursuant to

18 the analysis conducted under subsection (a).’’.

Attest:

Secretary.
109TH CONGRESS

1ST SESSION S. 467

SENATE AMENDMENT TO

HOUSE AMENDMENT