AIA, Alliance Draft Reinsurance Pool Proposals
Washington
Although there is no formal legislation, insurance groups are starting to draft proposals for creating a federal government reinsurance pool for terrorism risks, National Underwriter has learned.
The Washington-based American Insurance Association and Downers Grove, Ill.-based Alliance of American Insurers are floating similar, but separate proposals to create a reinsurance mechanism that would be funded by premiums paid by policyholders. The goal is to reestablish the availability of reinsurance for terrorism risks, which has dried up substantially since the Sept. 11 terrorist attack on the United States, the groups said.
According to an early version of the AIA draft, a terrorism reinsurance pool would be federally-chartered as a mutual insurer, governed by primary insurance company members and regulated solely by the Treasury Department.
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