The bill was originally introduced last summer, but failed to pass in the waning days of the last Congress despite intense efforts in session's closing days. The measure had broad, bipartisan support in the Senate, but died on the House floor.

Efforts to move it collapsed after House Majority Leader Tom DeLay, R-Texas, objected to the two-year extension, and Democrats in the House rejected Rep. DeLay's proposal for a six months extension of TRIA pending further action in Congress this year.

Currently, TRIA expires Dec. 31, 2005.

The bill would establish a public/private partnership/commission to take up the challenge of constructing a transitional terrorism insurance backstop mechanism after TRIA ends, according to officials at the American Insurance Association, whose members are key supporters of the bill.

Leigh Ann Pusey, senior vice president of government affairs for the AIA, said that, "Insurers and other stakeholders have been undergoing an intensive process to explore longer-term options, something we all know is a vitally important goal."

TRIA extends a federal backstop against catastrophic terrorist attacks by paying all costs of a terrorism attack as defined by the bill beyond a 15 per cent threshold of losses that are paid by the insurance underwriter.

The three-year bill was enacted in late 2002, with the retention threshold starting at 10 per cent, rising to 12.5 per cent in the second year and 15 per cent this year.

"Congress must act quickly before TRIA expires. The threat of terrorism still looms," Ms. Pusey said. "These two widely respected senators continue to show the leadership needed on this issue. They were there following the 9/11 attack, and they have stepped up again to ensure our nation's economic safety net does not unravel," she concluded.

Yesterday, Federal Reserve Chairman Alan Greenspan said during testimony on Federal Reserve policy before the House Financial Services Committee that he is not persuaded that the private market alone can work well enough to insure against the continuing threat of terrorist attacks.

A trade group funded by the National Association of Real Estate Trust noted that Mr. Greenspan's comments regarding terrorism came just one day after Porter Goss, the director of the Central Intelligence Agency, said in Senate testimony that the terrorism threat endures. The group quoted Mr. Goss as saying that "it may be only a matter of time" before extremist groups attempt to use chemical, biological, radiological or nuclear weapons in the U.S.

The group, the Coalition to Insure Against Terrorism, said that, according to Goss, al-Qaeda remains "intent on finding ways to circumvent U.S. security enhancements to strike Americans and the homeland."

Martin L. DePoy, steering committee coordinator of the Coalition to Insure Against Terrorism (CIAT), and vice president for government relations at the National Association of Real Estate Investment Trusts said, "Americans are well aware that it is not a matter of if, but when, terrorists will strike again, a fact reiterated by Director Goss."

Mr. DePoy added that, "Goss' observations, in combination with Greenspan's comments, underline the importance of Congress acting now to provide for the availability of terrorism insurance next year." He said the risks cited by the CIA director "are almost wholly uninsured today."