On July 17, the U.S. Senate passed a bill to renew TRIA by an overwhelming, bipartisan vote of 93-4. The House Financial Services Committee had also passed its own bill to reauthorize the program, but unfortunately it was on a partisan vote, and despite the effort from Republican leadership, lacked the votes to pass out of the full House. While most believe the House would pass the Senate's version of TRIA, Rep. Jeb Hensarling (R-Texas), chairman of the House Financial Services Committee, refused to give up on his preferred reauthorization bill. This impasse derailed further action until after the November elections.

Hensarling, perhaps betting on a GOP takeover in the Senate, continued to push his own TRIA reauthorization bill, H.R. 4871, the TRIA Reform Act of 2014, which gradually raises the program trigger and provides a federal backstop only for chemical, biological, radiological, and nuclear (CBRN) events after five years. The bill would end TRIA as we know it.

Injecting this kind of uncertainty into something as important as the continued availability of terrorism coverage plays havoc with our nation's economy. Middle-market commercial policyholders could face an availability crisis if the federal backstop is effectively gutted, as some have proposed. This is not solely a concern of marquee properties in large East Coast cities; terrorism cover is essential for businesses across the U.S., from shopping centers in the Midwest to oil rigs in the Gulf of Mexico.

This is an inopportune time for cutbacks on the federal terrorism insurance backstop, which costs the government no money.

In September, President Barack Obama declared the Islamic State of Iraq and Syria (ISIS) a “severe threat” to the U.S. and ordered airstrikes on ISIS targets in Syria. The fear that ISIS could initiate attacks against the U.S. prompted the Insurance Information Institute (III) to issue a report calling for a quick renewal of TRIA.

III's rationale makes sense. If the risk of terrorism is increasing, shouldn't we be increasing—not decreasing—preparations to deal with that threat?

The cause of congressional unpredictability is a basic difference of opinion about the proper role of government. Some legislators say the federal government has a legitimate role in assisting the business community, especially in matters of protecting the public. Other legislators believe just as passionately that the role of government in business should be greatly reduced, no matter what the intention.

Until this basic philosophical difference moves closer to being resolved—or until the advocates of one approach or the other gain a clear, sustained political advantage—there will be more uncertainty.

Looking at the dysfunction in Washington, we can take comfort in the fact that insurance is regulated by the states. The idea that disagreements about issues affecting insurance will be settled once the elections are over contradicts recent history. One election will not heal the partisan divide causing all the gridlock. Not much will be resolved by this one election cycle. It will just lead to the next cycle, which has already started.