The U.S. Treasury Department has extended the Terrorism Risk Insurance Act of 2002's "make available" requirement through 2005. The act, which was prompted by the terrorist attacks of Sept. 11, 2001, established a three-year program to promote the recovery of U.S. businesses following catastrophic terrorist attacks. In exchange for the federal government's agreeing to shoulder a share of the financial risk of future attacks, insurers were required to offer terrorism coverage on commercial policies written during the first two years of the program, as well as to retain an escalating financial burden of insured losses from a future attack.

Currently, Congress is considering whether to extend TRIA, which expires Dec. 31, 2005. The insurance industry has been vocal in its support of such an action. "Because Treasury has now decided that commercial insurers must make terrorism coverage available for policies written at any time during 2005, insurers and policyholders will be exposed during the part of the coverage term that runs beyond TRIA," said Stef Zielezienski, vice president and associate general counsel for the American Insurance Association. "Policyholders, state insurance regulators, and insurers understand that this potential mismatch between policy periods and TRIA's expiration makes it absolutely critical that Congress acts this year to extend TRIA beyond December 31, 2005."