disability resulting from an act or acts of terrorism
in the event that—
(A) such acts significantly affect mortality
experience of the population of the United States
over any period of time;
(B) such losses jeopardize the capital and
surplus of the life insurance industry in the
United States as a whole; or
(C) other consequences from such acts occur,
as determined by the Commission, that may sig-
nificantly affect the ability of the life insurance
industry in the United States to independently
cover such losses.
(d) RECOMMENDATIONS.—The Commission may make
a recommendation pursuant to subsection (c) only upon the
concurrence of a majority of the members of the Commis-
sion.
(e) REPORT.—Not later than 120 days after the date
of enactment of this Act, the Commission shall submit to
the House of Representatives and the Senate a report de-
scribing the results of the study and any recommendations
developed under subsection (c).
(f) TERMINATION.—The Commission shall terminate
60 days after submission of the report as provided for in
subsection (e).
SEC. 17. RAILROAD INSURANCE STUDY.
The Secretary of the Treasury shall conduct a study
to determine how the Federal Government can address a
possible crisis in the availability and affordability of rail-
road insurance by making such insurance for acts of ter-
rorism available on commercially reasonable terms. Not
later than 120 days after the date of the enactment of this
Act the Secretary shall submit to the Congress a report re-
garding the results and conclusions of the study.
SEC. 18. STUDY OF REINSURANCE POOL SYSTEM FOR FU-
TURE ACTS OF TERRORISM.
(a) STUDY.—The Secretary of the Treasury, the Board
of Governors of the Federal Reserve System, and the Comp-
troller General of the United States shall jointly conduct
a study on—
(1) the advisability and effectiveness of estab-
lishing a reinsurance pool system relating to future
acts of terrorism to replace the Program provided for
under this Act; and
(2) the potential effects of the amendments made
by section 11 of this Act on the availability of ter-
rorism insurance coverage.
(b) CONSULTATION.—In conducting the study under
subsection (a), the Secretary of the Treasury, the Board of
Governors of the Federal Reserve System, and the Comp-
troller General shall consult with (1) academic experts, (2)
the United Nations Secretariat for Trade and Development,
(3) representatives from the property and casualty insur-
ance industry, (4) representatives from the reinsurance in-
dustry, (5) the NAIC, and (6) such consumer organizations
as the Secretary considers appropriate.
(c) REPORT.—Not later than 6 months after the date
of the enactment of this Act, the Secretary, the Board of
Governors of the Federal Reserve System, and the Comp-
troller General shall jointly submit a report to the Congress
on the results of the study under subsection (a).
SEC. 19. DEFINITIONS.
For purposes of this Act, the following definitions shall
apply:
(1) ACT OF TERRORISM.—
(A) IN GENERAL.—The term ‘‘act of ter-
rorism’’ means any act that the Secretary deter-
mines meets the requirements under subpara-
graph (B), as such requirements are further de-
fined and specified by the Secretary in consulta-
tion with the NAIC.
(B) REQUIREMENTS.—An act meets the re-
quirements of this subparagraph if the act—
(i) is unlawful;
(ii) causes harm to a person, property,
or entity, in the United States, or in the
case of a domestic United States air carrier
or a United States flag vessel, in or outside
the United States;
(iii) is committed by a person or group
of persons or associations who are recog-
nized, either before or after such act, by the
Department of State or the Secretary as a
terrorist group or have conspired with such
a group or the group’s agents or surrogates;
(iv) has as its purpose to overthrow or
destabilize the government of any country
or to influence the policy or affect the con-
duct of the government of the United States
by coercion; and
(v) is not considered an act of war.
(2) AFFILIATE.—The term ‘‘affiliate’’ means,
with respect to an insurer, any company that con-
trols, is controlled by, or is under common control
with the insurer.
(3) AGGREGATE WRITTEN PREMIUM.—The term
‘‘aggregate written premium’’ means, with respect to
a year, the aggregate premium amount of all commer-
cial property and casualty insurance coverage written
during such year for persons or properties in the
United States under all lines of commercial property
and casualty insurance.
(4) COMMERCIAL INSURER.—The term ‘‘commer-
cial insurer’’ means any corporation, association, so-
ciety, order, firm, company, mutual, partnership, in-
dividual, aggregation of individuals, or any other
legal entity that provides commercial property and
casualty insurance. Such term includes any affiliates
of a commercial insurer.
(5) COMMERCIAL PROPERTY AND CASUALTY IN-
SURANCE.—
(A) IN GENERAL.—The term ‘‘commercial
property and casualty insurance’’ means insur-
ance or reinsurance, or retrocessional reinsur-
ance, for persons or properties in the United
States against—
(i) loss of or damage to property;
(ii) loss of income or extra expense in-
curred because of loss of or damage to prop-
erty;
(iii) 
third 
party 
liability 
claims
caused by negligence or imposed by statute
or contract, including workers compensa-
tion; or
(iv) loss resulting from debt or default
of another.
(B) EXCLUSIONS.—Such term does not
include—
(i) insurance for homeowners, tenants,
private passenger nonfleet automobiles, mo-
bile homes, or other insurance for personal,
family, or household needs;
(ii) insurance for professional liability,
including medical malpractice, errors and
omissions, or directors’ and officers’ liabil-
ity; or
(iii) health or life insurance.
(6) CONTROL.—A company has control over an-
other company if—
(A) the company directly or indirectly or
acting through one or more other persons owns,
controls, or has power to vote 25 percent or more
of any class of voting securities of the other com-
pany;
(B) the company controls in any manner
the election of a majority of the directors or
trustees of the other company; or
(C) the Secretary determines, after notice
and opportunity for hearing, that the company
directly or indirectly exercises a controlling in-
fluence over the management or policies of the
other company.
(7) COVERED PERIOD.—The term ‘‘covered pe-
riod’’ has the meaning given such term in section
5(b).
(8) INDUSTRY-WIDE LOSSES.—The term ‘‘indus-
try-wide losses’’ means the aggregate insured losses
sustained by all insurers, from coverage written for
persons or properties in the United States under all
lines of commercial property and casualty insurance.
(9) INSURED
LOSS.—The term ‘‘insured loss’’
means any loss in the United States covered by com-
mercial property and casualty insurance.
(10) NAIC.—The term ‘‘NAIC’’ means the Na-
tional Association of Insurance Commissioners.
(11) NET PREMIUM.—The term ‘‘net premium’’
means, with respect a commercial insurer and a year,
the aggregate premium amount collected by such com-
mercial insurer for all commercial property and cas-
ualty insurance coverage written during such year for
persons or properties in the United States under all
lines of commercial property and casualty insurance
by such commercial insurer, less any premium paid
by such commercial insurer to other commercial in-
surers to insure or reinsure those risks.
(12) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of the Treasury.
(13) STATE.—The term ‘‘State’’ means the States
of the United States, the District of Columbia, the
Commonwealth of Puerto Rico, the Commonwealth of
the Northern Mariana Islands, Guam, the Virgin Is-
lands, American Samoa, and any other territory or
possession of the United States.
(14) STATE INSURANCE REGULATOR.—The term
‘‘State insurance regulator’’ means, with respect to a
State, the principal insurance regulatory authority of
the State.
(15) TRIGGERING
DETERMINATION.—The term
‘‘triggering determination’’ has the meaning given
such term in section 5(a).
(16) TRIGGERING EVENT.—The term ‘‘triggering
event’’ means, with respect to a triggering determina-
tion, the occurrence of an act of terrorism, or the oc-
currence of such acts, that caused the insured losses
resulting in such triggering determination.
(17) 
UNITED
STATES.—The 
term 
‘‘United
States’’ means, collectively, the States (as such term
is defined in this section).
SEC. 20. EXTENSION OF PROGRAM.
(a) AUTHORITY.—If the Secretary determines that ac-
tion under this section is necessary to ensure the adequate
availability in the United States of commercial property
and casualty insurance coverage for acts of terrorism, the
Secretary may, subject to subsection (c), provide that the
provisions of this Act shall continue to apply with respect
to calendar year 2003. If the Secretary extends such appli-
cability to 2003, the Secretary may, in addition, extend
such applicability to calendar year 2004.
(b) COVERED PERIOD.—If the Secretary exercises the
authority under subsection (a), notwithstanding section
5(b) and 19(7), each of the calendar years to which the Sec-
retary extends the applicability of this Act shall be consid-
ered to be a covered period for purposes of this Act.
(c) REPORT.—The Secretary may exercise the author-
ity under subsection (a) to extend the applicability of this
Act to 2003 or 2004 only if the Secretary submits a report
to the Congress providing notice of and setting forth the
reasons for such extension for such specific year.
SEC. 21. REGULATIONS.
The Secretary shall issue any regulations necessary to
carry out this Act.
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as
the ‘‘Terrorism Risk Protection Act’’.
(b) TABLE OF CONTENTS.—The table of con-
tents for this Act is as follows:
Sec. 1. Short title and table of contents.
Sec. 2. Congressional findings.
Sec. 3. Designation of Administrators.
Sec. 4. Submission of premium information to Administrator.
Sec. 5. Triggering determination and covered period.
Sec. 6. Federal cost-sharing for commercial insurers.
Sec. 7. Assessments.
Sec. 8. Terrorism loss repayment surcharge.
Sec. 9. Administration of assessments and surcharges.
Sec. 10. Study of reserves for property and casualty insurance
for terrorist or other catastrophic events.
Sec. 11. State preemption.
Sec. 12. Consistent State guidelines for coverage for acts of ter-
rorism.
Sec. 13. Consultation with State insurance regulators and
NAIC.
Sec. 14. Sovereign immunity protections.
Sec. 15. Study of potential effects of terrorism on life insur-
ance industry.
Sec. 16. Definitions.
Sec. 17. Extension of program.
Sec. 18. Regulations.
SEC. 2. CONGRESSIONAL FINDINGS.
The Congress finds that—
(1) the terrorist attacks on the World
Trade Center and the Pentagon of Sep-
tember 11, 2001, resulted in a large num-
ber of deaths and injuries, the destruc-
tion and damage to buildings, and inter-
ruption of business operations;
(2) the attacks have inflicted possibly
the largest losses ever incurred by insur-
ers and reinsurers;
(3) while the insurance and reinsur-
ance industries have committed to pay
the losses arising from the September 11
attacks, the resulting disruption has cre-
ated widespread market uncertainties
with regard to the risk of losses arising
from possible future terrorist attacks;
(4) such uncertainty threatens the
continued availability of United States
commercial property casualty insurance
for terrorism risk at meaningful coverage
levels;
(5) the unavailability of affordable
commercial property and casualty insur-
ance for terrorist acts threatens the
growth and stability of the United States
economy, including impeding the ability
of financial services providers to finance
commercial property acquisitions and
new construction;
(6) in the past, the private insurance
markets have shown a remarkable resil-
iency 
in 
adapting 
to 
changed 
cir-
cumstances;
(7) given time, the private markets
will diversify and develop risk spreading
mechanisms to increase capacity and
guard against possible future losses in-
curred by terrorist attacks;
(8) it is necessary to create a tem-
porary industry risk sharing loan pro-
gram to ensure the continued availability
of commercial property and casualty in-
surance and reinsurance for terrorism-re-
lated risks;
(9) such action is necessary to limit
immediate market disruptions, encourage
economic stabilization, and facilitate a
transition to a viable market for private
terrorism risk insurance; and
(10) 
in 
addition, 
it 
is 
necessary
promptly to conduct a study of whether
there is a need for reserves for property
and casualty insurance for terrorist or
other catastrophic events.
SEC. 3. DESIGNATION OF ADMINISTRATORS.
(a) IN GENERAL.—Not later than December
1, 2001, the President shall designate a Fed-
eral officer or officers to act as the Adminis-
trator or Administrators responsible for car-
rying out this Act and the responsibilities
under this Act to be carried out by each such
officer.
(b) SENSE OF CONGRESS.—It is the sense of
the Congress that in determining the Admin-
istrator responsible for making any deter-
minations, for purposes of this Act, as to
whether a loss was caused by an act of ter-
rorism and whether such loss was caused by
one or multiple such events, pursuant to sec-
tion 5(b), the President should consider the
appropriate role of the Assistant to the Presi-
dent for Homeland Security.
SEC. 4. SUBMISSION OF PREMIUM INFORMATION TO AD-
MINISTRATOR.
To the extent such information is not oth-
erwise available to the Administrators, the
appropriate Administrator may require each
insurer to submit, to the appropriate Admin-
istrator or to the NAIC, a statement specifying
the aggregate premium amount of coverage
written by such insurer for properties and
persons in the United States under each line
of commercial property and casualty insur-
ance sold by such insurer during such periods
as the appropriate Administrator may pro-
vide.
SEC. 5. TRIGGERING DETERMINATION AND COVERED PE-
RIOD.
(a) IN GENERAL.—For purposes of this Act,
a ‘‘triggering determination’’ is a determina-
tion by the appropriate Administrator that
the insured losses resulting from the event of
an act of terrorism occurring during the cov-
ered period (as such term is defined in sub-
section (b)), or the aggregate insured losses
resulting from multiple events of acts of ter-
rorism all occurring during the covered pe-
riod, meet the requirements under either of
the following paragraphs:
(1) INDUSTRY-WIDE
LOSS
TEST.—Such
industry-wide 
losses 
exceed
$1,000,000,000.
(2) CAPITAL SURPLUS AND INDUSTRY AG-
GREGATE TEST.—Such industry-wide losses
exceed $100,000,000 and some portion of
such losses for any single commercial in-
surer exceed—
(A) 10 percent of the capital sur-
plus of such commercial insurer (as
such term is defined by the appro-
priate Administrator); and
(B) 10 percent of the commercial
property 
and 
casualty 
premiums
written by such commercial insurer;
except that this paragraph shall not
apply to any commercial insurer that has
been making commercial property and
casualty insurance coverage available for
less than 4 years as of the date of the de-
termination under this subsection.
(b) COVERED PERIOD.—For purposes of this
Act, the ‘‘covered period’’ is the period begin-
ning on the date of the enactment of this Act
and ending on January 1, 2003.
(c) DETERMINATIONS REGARDING EVENTS.—
For purposes of subsection (a), the appro-
priate Administrator shall have the sole au-
thority for determining whether—
(1) 
an 
occurrence 
or 
event 
was
caused by an act of terrorism;
(2) insured losses from acts of ter-
rorism were caused by one or multiple
events or occurrences; and
(3) whether an act of terrorism oc-
curred during the covered period.
SEC. 6. FEDERAL COST-SHARING FOR COMMERCIAL INSUR-
ERS.
(a) IN GENERAL.—Pursuant to a triggering
determination, the appropriate Administrator
shall provide financial assistance to commer-
cial insurers in accordance with this section
to cover insured losses resulting from acts of
terrorism, which shall be repaid in accord-
ance with subsection (e).
(b) AMOUNT.—Subject to subsection (c),
with respect to a triggering determination,
the amount of financial assistance made avail-
able under this section to each commercial in-
surer shall be equal to 90 percent of the
amount of the insured losses of the insurer as
a result of the triggering event involved.
(c) AGGREGATE
LIMITATION.—The aggre-
gate amount of financial assistance provided
pursuant to this section may not exceed
$100,000,000,000.
(d) LIMITATIONS.—The appropriate Admin-
istrator may establish such limitations as may
be necessary to ensure that payments under
this section in connection with a triggering
determination are made only to commercial
insurers that are not in default of any obliga-
tion under section 7 to pay assessments or
under section 8 to collect surcharges.
(e) 
REPAYMENT.—Financial 
assistance
made available under this section shall be re-
paid through assessments under section 7 col-
lected by the appropriate Administrator and
surcharges remitted to the appropriate Ad-
ministrator 
under 
section 
8. 
Any 
such
amounts collected or remitted shall be depos-
ited into the general fund of the Treasury.
(f) 
EMERGENCY
DESIGNATION.—Congress
designates the amount of new budget author-
ity and outlays in all fiscal years resulting
from this section as an emergency require-
ment pursuant to section 252(e) of the Bal-
anced Budget and Emergency Deficit Control
Act of 1985 (2 U.S.C. 901(e)). Such amount
shall be available only to the extent that a re-
quest, that includes designation of such
amount as an emergency requirement as de-
fined in such Act, is transmitted by the Presi-
dent to Congress.
SEC. 7. ASSESSMENTS.
(a) IN GENERAL.—In the case of a trig-
gering determination, each commercial in-
surer shall be subject to assessments under
this section for the purpose of repaying finan-
cial assistance made available under section
6 in connection with such determination.
(b) AGGREGATE ASSESSMENT.—Pursuant to
a triggering determination, the appropriate
Administrator shall determine the aggregate
amount to be assessed among all commercial
insurers, which shall be equal to 90 percent
of the lesser of—
(1) the amount of industry-wide losses
resulting from the triggering event in-
volved; and
(2) $20,000,000,000.
(c) ALLOCATION OF ASSESSMENT.—
(1) IN GENERAL.—The appropriate Ad-
ministrator shall allocate the aggregate
assessment amount determined under
subsection (b) among all commercial in-
surers. The portion of the aggregate as-
sessment amount that is allocated as an
assessment on each commercial insurer
shall be based on the percentage, written
by that insurer, of the aggregate written
premium, for all commercial insurers, for
the calendar year preceding the assess-
ment.
(2) PAYMENT REQUIREMENT.—Upon no-
tification by the appropriate Adminis-
trator of an assessment under this sec-
tion, each commercial insurer shall be re-
quired to pay to the appropriate Adminis-
trator, in the manner provided under sec-
tion 9 by the appropriate Administrator,
the amount equal to the assessment on
such commercial insurer (subject to the
limitation under paragraph (3)).
(3) ANNUAL LIMITATION ON AMOUNT AL-
LOCATED TO EACH COMMERCIAL INSURER.—
(A) IN
GENERAL.—Of any assess-
ments under this section on a com-
mercial insurer, the portion required
to be paid by any commercial insurer
during a calendar year shall not ex-
ceed the amount that is equal to 3
percent of the aggregate written pre-
mium for such insurer for the pre-
ceding calendar year.
(B) MULTIPLE
PAYMENTS.—If any
amounts required to be repaid under
this section for a calendar year are
limited by operation of subparagraph
(A), the appropriate Administrator
shall provide that all such remaining
amounts shall be reallocated among
all commercial insurers (in the man-
ner provided in paragraph (1)) over
such 
immediately 
succeeding 
cal-
endar years, and repaid over such
years, as may be necessary to provide
for full payment of such remaining
amounts, except that the limitation
under subparagraph (A) shall apply
to the amounts paid in any such suc-
cessive calendar years.
(C) ADMINISTRATIVE FLEXIBILITY.—
(i) TIMING
OF
ASSESSMENTS.—
Assessments under this section in
connection with a triggering dem-
onstration shall be made, to the
extent that the appropriate Ad-
ministrator considers practicable
and appropriate, at the beginning
of the calendar year immediately
following the triggering deter-
mination.
(ii) ESTIMATES
AND
CORREC-
TIONS.—If the appropriate Admin-
istrator makes an assessment at a
time other than provided under
clause (i), the appropriate Admin-
istrator may—
(I) require commercial in-
surers to estimate their aggre-
gate written premiums for the
year in which the assessment
is made; and
(II) make a subsequent re-
fund or require additional
payments to correct such esti-
mation at the end of the cal-
endar year.
(4) DEFERRAL OF CONTRIBUTIONS.—The
appropriate Administrator may defer the
payment of part or all of the assessment
required under paragraph (2) to be paid
by a commercial insurer, but only to the
extent that the appropriate Adminis-
trator determines that such deferral is
necessary to avoid the likely insolvency
of the commercial insurer.
SEC. 8. TERRORISM LOSS REPAYMENT SURCHARGE.
(a) IMPOSITION AND COLLECTION.—If, pursu-
ant to a triggering determination, the appro-
priate Administrator determines that the ag-
gregate amount of industry-wide losses result-
ing from the triggering event involved ex-
ceeds $20,000,000,000, the appropriate Admin-
istrator shall—
(1) establish and impose a policy-
holder premium surcharge, as provided
under this section, on commercial prop-
erty and casualty insurance written after
such determination, for the purpose of
repaying financial assistance made avail-
able under section 6 in connection with
such triggering determination; and
(2) provide for commercial insurers to
collect 
such 
surcharge 
and 
remit
amounts collected to the appropriate Ad-
ministrator.
(b) AMOUNT
AND
DURATION.—The sur-
charge under this section shall be established
in such amount, and shall apply to commer-
cial property and casualty insurance written
during such period, as the appropriate Ad-
ministrator determines is necessary to re-
cover the aggregate amount of financial as-
sistance provided under section 6 to cover in-
sured losses resulting from the triggering
event that exceed $20,000,000,000.
(c) OTHER TERMS.—The surcharge under
this section shall—
(1) be based on a percentage of the
amount of commercial property and cas-
ualty insurance coverage that a policy
provides; and
(2) be imposed with respect to all
commercial property and casualty insur-
ance coverage written during the period
referred to in subsection (b).
SEC. 9. ADMINISTRATION OF ASSESSMENTS AND SUR-
CHARGES.
(a) MANNER
AND
METHOD.—The appro-
priate Administrator shall provide for the
manner and method of carrying out assess-
ments under section 7 and surcharges under
section 8, including the timing and proce-
nance of reserves against the risks of
acts of terrorism; and
(B) each State should adopt such
guidelines for purposes of regulating
commercial insurers doing business
in that State.
(2) CONSIDERATION OF ADOPTION OF NA-
TIONAL GUIDELINES.—Upon the expiration
of the 6-month period beginning on the
date of the enactment of this Act, the ap-
propriate Administrator shall make a de-
termination of whether the guidelines re-
ferred to in paragraph (1) have, by such
time, been developed and adopted by
nearly all States in a uniform manner. If
the 
appropriate 
Administrator 
deter-
mines that such guidelines have not been
so developed and adopted, the appro-
priate 
Administrator 
shall 
consider
adopting, and may adopt, such guidelines
on a national basis in a manner that
would supercede any State law regarding
maintenance of reserves against such
risks.