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Last Updated: 7/30/2025 
 
Issue: Prior to the attacks on the World Trade Center and the Pentagon on September 11, 2001, terrorism coverage was usually included in general insurance policies without an additional cost to insureds. After the attacks, coverage became . In response, the U.S. Congress passed the Terrorism Risk Insurance Act (TRIA) .    

TRIA was initially created as a temporary three-year federal program, allowing the federal government to share monetary losses with insurers on commercial property/casualty (P/C) losses due to a terrorist attack. It has since been renewed four times (, , , and ) and the U.S. Department of the Treasury also published an interim final rule on the process of certifying an act of terrorism . The current reauthorization is slated to expire December 31, 2027. TRIA requires insurers to make terrorism coverage available to commercial policyholders, but it does not require insureds to purchase it.   
 

Background: Despite the terrorist attacks on the World Trade Center in 1993 and the Oklahoma City bombing in 1995, insurers did not view domestic or international terrorism when underwriting commercial insurance policies because:   

As such, terrorism coverage was an that was covered in most standard all-risk commercial and homeowners policies prior to the attacks on September 11, 2001.  

The Insurance Information Institute (III) estimates that the 9/11 attacks cost the insurance industry (in 2024 dollars) in losses, making it the most expensive terrorist incident ever to occur in the U.S., as well as one of the largest single insured loss events in history. Reinsurers covered about two-thirds of the losses. A breakdown of the losses by specifics includes 33% for business interruption, while 30% included property losses, including the World Trade Center towers. Workers’ compensation, life, health, airline liability, and general liability insurance lines billions of dollars in claims.   

After the massive financial losses from the 9/11 attacks, reinsurers severely cut back on their terrorism coverage or stopped offering it altogether, straining U.S. insurers’ ability to cover the risk. As a result, the companies that continued to offer terrorism coverage charged exorbitant premiums, making terrorism insurance unaffordable and unattainable for many.    

Fearing the uncertainty of large-scale risk and the unsustainability of future terrorism losses, insurers defined terrorism as an uninsurable risk. In October 2001, the Insurance Services Office (ISO) for permission to exclude terrorism from all commercial insurance coverage. Ultimately, with the stipulation that workers’ compensation insurance be excluded from the provision. Some terrorism coverage did remain available in California, Florida, Georgia, New York, and Texas, even though these states did not approve the changes to commercial policies. As a result of the terrorism exclusion, very few companies had protection against terrorist actions in the year following the 9/11 attacks.   

Shortly thereafter, various industry groups called for federal intervention. The was passed by Congress on November 26, 2002, and signed into law by President George W. Bush.   

The 2019 Reauthorization of TRIA  

On December 20, 2019, President Donald Trump signed into law the Terrorism Risk Insurance Program Reauthorization Act of 2019 (), which extended the Terrorism Risk Insurance Program (TRIP) for seven years through December 31, 2027. The 2019 reauthorization:  

In the absence of private market innovations and solutions, sustaining a viable private market for terrorism insurance depends on a federal backstop. The ²»Á¼Ñо¿Ëù¹Ù·½ and state insurance commissioners play an essential role in administering TRIP, issuing timely guidance to insurers, and consulting with the Federal Insurance Office (FIO) and its TRIP Office.  

The ²»Á¼Ñо¿Ëù¹Ù·½ is committed to working with Congress, the administration, state officials, and the industry to develop a long-term plan to make terrorism insurance available and affordable.    

The ²»Á¼Ñо¿Ëù¹Ù·½ has played an active role in fostering the program and assisting insurers and the federal government with the program’s implementation. The ²»Á¼Ñо¿Ëù¹Ù·½ and its members have also testified before both houses of Congress on the need to extend the program.  

The ²»Á¼Ñо¿Ëù¹Ù·½ Property and Casualty Insurance (C) Committee and its Terrorism Insurance Implementation (C) Working Group adopted a model bulletin in 2020 which provides guidance to insurers regarding rate filings and policy language that state insurance regulators would find acceptable to protect U.S. businesses from acts of terrorism. The model bulletin describes important changes that are contained in TRIA and informs insurers regarding whether rate and policy form filings might be needed.  

The Working Group also adopted the Model Disclosure Form in 2020. Insurers may use the form as drafted, modify the forms to meet individual circumstances, or use forms that are substantially similar. The U.S. Department of the Treasury worked with the Committee and the Working Group to ensure the disclosures satisfy the revised disclosure requirements in TRIA.  

State insurance regulators began collecting data related to terrorism risk insurance in 2016. Additional information on that data collection process can be found on the ²»Á¼Ñо¿Ëù¹Ù·½ website.  

The Treasury Department provides updated information on TRIP, including announcements of all rulemakings, interpretive guidance, and requests for public comments.