Terrorism Reinsurance Act 2002
Since the terrorist acts of September 11, 2002; President Bush has signed into law the Terrorism Risk Protection Act of 2002; effective November 26, 2002. This law requires private commercial insurers and the federal government to share future losses for a 3 year period due to an act of international terrorism. As an insured with RHC, if this law changes your current coverage you will be notified directly from your insurance carrier. If you need to discuss this issue further please do not hesitate to contact our office directly at 800-338-7148.
Summary of major provisions
- State exclusions for terrorism are void to the extent they
exclude what would otherwise be "insured losses" under
the Act
- Personal lines losses are not covered under the Act
- Insurers have 90 days to notify existing commercial policyholders about the legislation, offer terrorism coverage and specify the cost of that coverage
- Policyholders have the option to accept or decline the coverage
- Provisions apply to existing, new and renewal policies
Policyholder notification
Within 90 days of the Act, we plan to notify commercial policyholders
as
follows:
Policies that do not contain a terrorism exclusion, a Letter will
include information about the legislation and the portion of premium
attributable to terrorism coverage. You will receive a copy of
this general announcement. No agent or policyholder action is
required.
Policies that currently contain a terrorism exclusion, a Letter will notify insureds that the terrorism exclusion has been voided by the Act and there is now an additional premium charge for terrorism coverage. They have the option to accept or decline the coverage. You will receive a copy of this letter and a list of your customers in this category.
Terrorism guidelines
Until further notice, RHC’s current terrorism guidelines
remain in effect. We will work closely with you on new and renewal
business accounts during this transition period, and will keep
you informed as this process evolves.