TREASURY ISSUES INTERIM RULE UNDER TERRORISM RISK INSURANCE ACT
The U.S. Department of the Treasury has issued its interim rule regarding definitions under the Terrorism Risk Insurance Act of 2002, effective immediately.
The interim rule requires that insurance companies must “receive direct earned premiums” to qualify as insurers under the Act.
As for the scope of insurance coverage, the Treasury Department said, “insurance is generally regulated by state law in the U.S. There is no uniform or consistent definition of ‘commercial property and casualty insurance’ among the states. In some states, a line of insurance may be considered commercial and in other states the same line of insurance is considered personal.”
For purposes of the Terrorism Risk program, “Treasury considers incidental commercial coverage to exist where less than 25 percent of [the] total premium is attributable to commercial coverage,” the department said.
Comments on the interim rule must be submitted to the department on or before March 31.
For more information, contact Mario Ugoletti, deputy director of the Office of Financial Institutions Policy, at (202) 622-2730.
The complete interim rule can be viewed on the Web at http://a257.g.akamaitech.net/7/257/2422/14mar20010800/edocket.access.gpo.gov/2003/pdf/03-4831.pdf.