The details of the agreement, Mr. Ward said, have been kept so quiet that insurance companies are not certain about whether the legislation, which limits private insurers' exposure, will actually work in the marketplace.

(For an outline of the agreement, see the story posted earlier on Hot News at www.nationalunderwriter.com.)

While congratulating the House and Senate conferees for reaching an agreement, Mr. Ward added that NAMIC is disappointed that personal lines will not be covered under the plan.

Reacting to this, NAMIC, the Alliance of American Insurers and the National Association of Independent Insurers immediately dashed off a letter to Congress stating that, "This omission creates an unwarranted inequity between commercial and personal lines policyholders." While the Sept. 11 attacks primarily impacted commercial lines, "this is no guarantee that any future attack could not severely impact personal lines companies and policyholders," the groups wrote.

There are many scenarios, Mr. Ward said, in which the solvency of a personal lines insurer could be threatened by a terrorist attack.

David Farmer, senior vice president of federal affairs with the Downers Grove, Ill.-based Alliance, praised the agreement, but added that it is still tentative.

"Not all the ?i's are dotted and ?t's crossed," Mr. Farmer said.

There are still some contentious issues, particularly involving tort reform, he said.

Gary Karr, a representative with the Washington-based American Insurance Association, also praised the agreement. However, he noted, at the time he was interviewed, that no one had seen the final details.

Nonetheless, Mr. Karr said, AIA is hopeful that the legislation, once enacted, will result in what everyone has said is the promise of the bill, which is to restore terrorism insurance coverage, secure the economy, and protect jobs.

Julie Gackenbach, director of federal relations for the Des Plaines, Ill.-based NAII, agreed. NAII is waiting to see the details, she said. But overall, NAII is happy that the agreement contains a true risk-sharing mechanism that should help stabilize the market.

From a broker's standpoint, Joel Wood, senior vice president of government affairs for the Washington-based Council of Insurance Agents and Brokers, said one of the most important issues is that the agreement apparently will cover business interruption insurance.

This was a major issue for brokers, Mr. Wood said, who have been emphasizing during this process that the transition between the federal program and private sector commercial insurance had to be seamless.

Some earlier versions of the legislation did not include business interruption coverage, he said.

Mr. Wood added that a lot of other transition issues remain unanswered at this point and could create problems for brokers and commercial clients once the program is in place.

Robert A. Rusbuldt, chief executive officer of the Alexandria, Va.-based Independent Insurance Agents and Brokers of America, said the lack of terrorism insurance has been plaguing the economy as a whole, and IIABA's business clients have been anxious to see the legislation.

He added, however, that the situation is still fluid.

"There are still some significant hurdles that must be addressed, and the process of attaining signatures on the conference report (the agreement), and exactly when and how the conference reform can or will be considered, is up in the air," Mr. Rusbuldt said.

Indeed, despite the bipartisan nature of the agreement, which was largely hammered out by the White House and Senate Democrats led by Sen. Chris Dodd, D-Conn., tort reform efforts to limit legal exposures from terrorism damage claims still seems to be haunting the issue.

The agreement is essentially silent on the hotly contentious issue of punitive damages. Under the agreement, the tort law of the state where a terrorist attack occurs will govern any liability lawsuits, even though all cases will be tried in a federal court.

If that state's tort permits unrestricted punitive damages, plaintiffs would be able to seek punitive damages against American businesses.

Sources told National Underwriter that many Republicans are upset by this. Indeed, some leading Republicans who were involved in the negotiations may decline to sign the agreement, sources said.

In addition, consumer groups are strongly opposed to the agreement, calling it "a taxpayer-financed hand out" to insurance companies.

"Instead of helping the relatively few businesses that can't get terror coverage, Congress is poised to give away reinsurance to a rich and politically powerful insurance industry," said J. Robert Hunter, director of insurance for the Washington-based Consumer Federation of America.

One factor blocking passage is that, at this writing, Congress is in recess and not expected to return until after the Nov. 5 election.

This gives opponents of the agreement a month or more to mount an attack before it comes up for a vote.

Mr. Wood said that with all due respect to Mr. Hunter and consumer groups, the bigger problem for the legislation right now is with Republicans.

In addition to concerns over liability, he noted, some Republicans are also concerned over the individual company retention levels, which they believe are too low.

Nonetheless, he said, the White House is strongly supporting the agreement. This, Mr. Wood said, should be enough to overcome the objections to the liability provision and the retention issue.

Mr. Wood added that while the likelihood is that the agreement will not be considered for a vote until mid-November, there is one scenario in which it could come up as early as next week.

He noted that Congress is still trying to reach an agreement on a Homeland Security bill. While Congress is in recess, he said, members have been advised that they may be called back into session on 48 hours notice if a Homeland Security agreement is reached.

If that happens, Mr. Wood said, he would not rule out a vote on a terrorism insurance bill at the same time.