A House Republican's effort to rally support for overhauling the Terrorism Risk Insurance Program fell flat, sources familiar with the matter told SNL on Nov. 5.
Trade groups and business organizations spanning the insurance, real estate and banking industries refused to formally back Rep. Randy Neugebauer's bill to reauthorize the program for five years and make significant changes to its structure, despite assurances from Neugebauer's office that he was open to softening some of those changes. A Neugebauer aide met with the groups Oct. 22 to ask for their support, which would have included signing a public letter endorsing the bill.
The business community's answer over the next several days was a universal "no," sources said. Many rejected the idea immediately, citing their strong objections to parts of the bill. Others, including groups representing the reinsurance industry and insurance brokers, said they would sign the endorsement only if enough other organizations joined them. When few offered their support, they dropped out as well.
"Nobody is stepping forward to offer any formal support of his bill," an industry source told SNL. "There were several groups that would have been happy to if they had company. But they just weren't able to find any company, so they stayed quiet."
A representative from Neugebauer's office did not respond to a request for comment.
The business community voiced several concerns with Neugebauer's proposal from the outset. Insurance, banking and real estate companies have already spent months criticizing the bill for rolling back a crucial program that stabilizes the terrorism insurance market. The bill's reforms would make it harder to activate the program in the event of a terror attack and less beneficial to insurance companies, they argue, likely pushing smaller insurers out of the sector and forcing the remaining companies to raise prices.
Neugebauer's latest offer would not have eased those fears. Rather than making substantive changes to the bill, his office promised only to be more flexible on those terms once the bill passed the House. The Senate has already passed a seven-year TRIA reauthorization with just minor changes to the program.
With Neugebauer unwilling to make any firm concessions, the business groups opted to stand by their clients' interests.
The failed coalition leaves Neugebauer and his ally, Rep. Jeb Hensarling, R-Texas, largely isolated on the issue. There is little support in the House for the five-year reauthorization bill, with a large proportion of lawmakers favoring a solution closer to the Senate bill. The House leadership has no interest in stringing out a fight over TRIA, sources said. Only Hensarling's position as Financial Services Committee chairman has allowed him to block competing proposals for this long. Business groups, meanwhile, have been frustrated by Hensarling's unwillingness to compromise.
"We tried to give him about 10 different opportunities to spin and claim victory, all of which he said, 'No, thank you' to," an industry source said.
Both Neugebauer and Hensarling have threatened to extend TRIA's existing authorization by six to 12 months if they cannot pass their original bill by the end of the year. Industry groups warn that the inherent uncertainty of a short-term extension would destabilize pricing in the terrorism insurance market.