WASHINGTON— The Senate voted Thursday to extend a program that helped stabilize jittery insurance markets in the aftermath of the Sept. 11, 2001, terrorist attacks.
The program is designed to cushion the financial blow to insurance companies in the event of another massive attack. It is scheduled to expire at the end of the year.
The Senate voted 93-4 to extend the program through 2021. Under the program, the federal government helps pay damages for attacks that cost more than $100 million.
“In a post-9/11 world, developers and business owners embarking on multiyear, multimillion or billion-dollar construction projects need to be certain they can insure their investments,” said Sen. Chuck Schumer, D-N.Y., who sponsored the bill. “At a time when our economy is not growing as robustly as we’d like, failing to renew (the program) would be particularly foolish. Without (the program), it’s a virtual certainty that a large number of construction jobs and economic development would be lost.”
President Barack Obama supports the bill, the White House said Thursday.
“Terrorism insurance is necessary for a broad range of economic activities in areas across the country, and would be prohibitively expensive or unavailable in the absence of the program,” a White House statement said.
The House is considering a similar bill that treats conventional and nuclear attacks differently, providing less federal help for attacks using conventional weapons.
Rep. Randy Neugebauer, R-Texas, sponsored the House bill. He said it protects taxpayers “from further Washington-sponsored risk.”
The program was first enacted in 2002, when insurance companies were reluctant to provide coverage for terrorist attacks. The program has never been triggered because there haven’t been any attacks that caused more than $100 million in insurance losses, according to the nonpartisan Congressional Budget Office.
However, supporters say the program has made it possible for commercial property owners to get coverage, especially large venues that might be more vulnerable to a terrorist attack.
Under the program, companies that sell commercial property and casualty insurance must offer coverage for terrorist attacks. In exchange for this requirement, the federal government will help insurers cover losses under certain conditions.
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