Overview
The U.S. Senate passed legislation on Sept. 28 to reauthorize the federal terrorism insurance backstop through 2034, moving Congress closer to extending a program scheduled to expire at the end of 2027.
The Senate approved the Terrorism Risk Insurance Program Reauthorization Act of 2026, S. 4395, by unanimous consent. Earlier in September, the Senate Banking Committee advanced the legislation in a 24-0 vote.
The House of Representatives already passed its own TRIA reauthorization measure, H.R. 7128, by a 373-15 vote in June. The House bill also extends the program through 2034, though differences between the House and Senate versions still need to be resolved before legislation reaches the president.
The insurance industry has pushed Congress to complete the process well ahead of the current Dec. 31, 2027 expiration date. Insurers and policyholders are already negotiating contracts extending beyond 2027, making the status of the federal backstop relevant to pricing, capacity and the availability of terrorism coverage.
This action reflects strong bipartisan recognition that TRIA remains essential to maintaining economic stability, supporting investment, and ensuring the availability of terrorism risk insurance for businesses and communities across the country.
Sam Whitfield, senior vice president of federal government relations and political engagement at the American Property Casualty Insurance Association
TRIA provides federal terrorism insurance backstop
Congress created the Terrorism Risk Insurance Program after the Sept. 11, 2001 attacks, when terrorism coverage largely disappeared from the commercial insurance market. The Terrorism Risk Insurance Act of 2002 established a public-private structure for insured losses arising from certified terrorist attacks.
Under the program, private insurers remain responsible for terrorism coverage and retain losses through individual deductibles. Federal compensation becomes available after a terrorist event is formally certified and insured industry losses reach the program trigger. Treasury administers the program through the Federal Insurance Office.
TRIA has never been triggered by a certified terrorism event. The program has been extended several times since its creation. Congress reauthorized it in 2005, 2007, 2015 and 2019, with the latest extension moving the expiration date to Dec. 31, 2027.
The current congressional effort would extend that framework for another seven years.
Industry groups press for completion before 2027
Insurance trade groups welcomed the Senate action and urged lawmakers to reconcile the two bills without waiting until the current authorization approaches expiration.
The industry argues that an early extension gives insurers, policyholders, lenders and commercial property developers more certainty when negotiating multiyear insurance and financing agreements.
Construction and development across the country depend on having coverage against terrorism available to secure financing and create jobs.
Jimi Grande, senior vice president of federal and political affairs at the National Association of Mutual Insurance Companies
Grande said the Senate’s action would give projects and businesses more certainty around the continued availability of terrorism insurance.
The House approved H.R. 7128 in June after the House Financial Services Committee advanced the measure earlier in the year. Besides extending TRIA through 2034, the House legislation includes changes related to the loss threshold and the process used by the Treasury Department when determining whether an event qualifies as an act of terrorism under the program.
The Senate version, S. 4395, also extends TRIA by seven years. Its passage followed unanimous approval by the Senate Banking Committee.
Because the chambers approved different legislation, Congress still needs to settle the differences or have one chamber adopt the other’s version.
Insurance market seeks certainty on terrorism risk
The push for early reauthorization reflects the unusual nature of terrorism exposure for insurers. Historical loss data offers limited guidance because attackers change targets and methods, while information about attempted attacks is often unavailable to commercial insurers for national security reasons.
Terrorism is an unknowable threat. Unlike natural disasters, terrorists will seek out vulnerable areas and adapt their plans to counter our defenses.
For commercial insurance markets, TRIA operates as a federal backstop behind private coverage rather than replacing private insurers. Treasury describes the program as a system of shared public and private compensation for insured losses resulting from certified terrorist acts.
The program also contains insurer deductibles, federal loss-sharing provisions and mechanisms for recovering certain federal payments.
Those features determine how losses are divided between insurers, the federal government and, in some circumstances, policyholders through recoupment provisions.
The Senate vote leaves the reauthorization closer to completion more than a year before TRIA’s current expiration. The next legislative step is resolving the differences between S. 4395 and the House-approved H.R. 7128 before a final measure goes to the president.
