|
The recent signing of legislation by President Bush that creates a federal backstop for terrorism insurance was welcome news for the National Association of Realtors after a year-long coordination of industry efforts.
The Terrorism Risk Protection Act, HR 3210, will make the federal government the insurer of last resort for the next three years by covering 90 percent of the cost of a future terrorist attack for losses over $10 billion to $15 billion. The legislation, which will pay up to $100 billion in claims, also mandates that property and casualty insurers offer traditional terrorism insurance in all 50 states.
The current shortage of adequate and affordable terrorism insurance has severely reduced and restricted commercial real estate transactions, making it increasingly difficult to operate or acquire properties, build new projects and find appropriate financing. Over $15.5 billion worth of real estate projects in almost 20 states have been stalled or cancelled due to the ongoing lack of terrorism insurance, according to a recent survey.
"We applaud the Senate for passing legislation that will address the current terrorism insurance crisis. The lack of available and affordable terrorism insurance has severely hampered the real estate and construction industries since Sept. 11," said association President Cathy Whatley. "This legislation will help revive real estate and construction projects.
Information provided in this column is presented by the Realtor members of the Silicon Valley Association of Realtors at www.silvar.org. Send questions on any topic to jnewton@jnpr.com.
|
