Political Quotes

“on September 11, in addition to the enormous loss of human life, the value of which cannot be measured, our Nation suffered catastrophic economic losses. The attacks of September 11 resulted in $30 billion worth of insured losses, the largest catastrophic insurance loss in the history of the United States, larger than any blizzard, tornado or hurricane. As a result, insurers and reinsurers began to worry about the likelihood and the cost of a future terrorist attack. Worrying about risk and then monetizing that risk is the key to the insurance industry, which is an essential element in a modern dynamic economy. As happened, businesses with legitimate concerns about their solvency, insurance and reinsurance firms withdrew from the market where the attack took place. As the supply of terrorism insurance rapidly decreased, New York City developers, for whom terrorism insurance was essential to secure financing for their projects, were put in a precarious position. They needed terrorism insurance to continue building, but the market for insurance simply did not have enough supply to meet their demand. Similar shortages began occurring throughout the country. In simple terms, there was a market failure. It was out of this dilemma that the critical need to address that original version of TRIA was born.”