Barbara Boxer: “This bill would preempt state law with regard to the prior approval or a waiting period of terrorism risk insurance.…”

“This bill would preempt state law with regard to the prior approval or a waiting period of terrorism risk insurance. Specifically, section 7 states, ``rates for terrorism risk insurance covered by this Act and filed with any State shall not be subject to prior approval or a waiting period, under any law of a State that would otherwise be applicable.'' This language would preempt the law of the State of California and 21 other States where prior approval mechanisms for increases in insurance rates have been put into place to keep insurance companies from gouging consumers. The bill before us does allow States to invalidate excessive rates after the fact. But it will do nothing for consumers who have already paid too much. Prior approval mechanisms are the only way to protect consumers before sky-high rates go into effect. I understand that my colleagues who support this legislation want terrorism insurance made available as quickly as possible. And that is the reason for his preemption--to speed up the process. I agree. So to meet both the need for quick insurance availability and the desire to allow states to review rates for at least some period before they go into effect, I had proposed an amendment to replace the blanket State preemption language in the bill with more narrow language.”