The US House of Representatives has passed a bill which would reinstate the Terrorism Risk Insurance Act (Tria) which expired on December 31 2014.
The bill passed in the House with 416 votes in favour and only five against.
The new Tria bill is identical to the bill that passed the House in December but which failed to get through the Senate. However some of the obstructive factors in that chamber are no longer present.
Tria’s failure to pass in the Senate was primarily the responsibility of Former Republican Senator Tom Coburn (R-OK), who objected to a provision in the bill to create a semi-federalised network of agents and brokers and placed a hold on the bill (NARABII).
The bill also faced opposition from Democrats over a separate provision in which included substantial changes to the Dodd-Frank act.
This meant that the Democratic leadership in the Senate did not move to override Coburn’s hold, and the bill was allowed to fail without coming to a vote.
While these provisions still exist in the House’s new bill, Coburn is now gone, and the Republicans control the Senate.
If Democrats in the Senate are to stop the bill over the Dodd-Frank provisions they will have to either place a hold on the bill or filibuster.
This seems unlikely given the fact that their colleagues in the House have overwhelmingly voted for the same Tria renewal bill twice in two months.
If the bill passes the Senate it would then be sent to the White House to be signed.
The Obama administration like Senate Democrats also expressed disapproval of the bill in December because of the additional Dodd-Frank provisions, but importantly did not say it would veto the bill.
The insurance industry is eagerly awaiting a conclusion to the Tria debate given the limbo which has been in place since the programme expired at the end of last year.
On Wednesday industry figures expressed their enthusiasm for the House’s early action.
“PCI is grateful that an overwhelming, bipartisan majority in the House came together, again to vote to maintain America’s economic resiliency plan to recover from terrorist attacks,” said David Sampson, president and chief executive (CEO) of the Property Casualty Insurers Association of America (PCI)."
“PCI calls on the Senate to act swiftly, pass H.R. 26, and send a final bill to the president’s desk in January,” he continued.
The market will now be hopeful that the Senate will move to quickly pass the House bill.
“Today,the House recognised the ongoing importance of Tria to our national economic security and quickly acted to reauthorise the programme,"said Leigh Ann Pusey, president and CEO of the American Insurance Association (AIA). "We urge the Senate to quickly pass the bill in order to restore market certainty and protect our economy against terrorism.”