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The Terrorism Risk Insurance Act of 2002 provided free federal insurance coverage to insurance companies in the event of an extreme loss. The once-extended program is set to expire on Dec. 31. The corporate lobby has argued that terrorism risk is unpredictable and potentially extreme, thus infeasible without federal support. This argument is not credible. Most acts of terrorism will not result in extreme loss. Moreover, the insurance industry is supposed to take risk for profit rather than riskless profit.
December 03, 2007 at 12:00 AM
1 minute read
The original version of this story was published on National Law Journal
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