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2014 Terrorism Risk Insurance Report


Although the Terrorism Risk Insurance Program Reauthorization Act was ultimately extended, uncertainty over its renewal served as a reminder to consider additional risk management strategies.

The cost of terrorism insurance coverage is expected to become volatile if the federal terrorism insurance backstop is not extended. TRIPRA’s uncertainty already has affected organizations that purchase property/casualty insurance.

Uncertainty around the potential expiration of the Terrorism Risk Insurance Program Reauthorization Act (TRIPRA) – scheduled to expire on December 31, 2014 – has significantly affected the property/casualty insurance industry. In 2014, some employers with large concentrations of workers and companies with property exposures in major cities in the United States have experienced limited terrorism insurance capacity and increased pricing, while others have not been able to purchase it at all. If Congress does not extend or renew TRIPRA, the market dynamics for terrorism insurance will be further disrupted and may result in increased pricing as capacity shrinks.

This year’s decision to extend TRIPRA as is, extend with modifications, or allow it to expire has been debated in and out of Congress. This report:

  • Summarizes the current outlook regarding TRIPRA’s potential expiration.
  • Provides benchmarking related to terrorism insurance takeup rates and pricing.
  • Offers insights on alternative insurance and risk management solutions for terrorism risks that will be useful for organizations even if TRIPRA is renewed or extended.