Senate committee approves terrorism insurance bill

The Senate Banking Committee approved legislation on Tuesday that would extend the government's terrorism insurance plan for seven years.

The panel approved the bipartisan Terrorism Risk Insurance Program Reauthorization Act of 2014 by a 22-0 vote. The legislation would raise commercial insurers' co-payment from 15 percent to 20 percent.

The bill, which is sponsored by Sen. Charles Schumer (D-N.Y.), differs from a House measure that would set new limits on reimbursements for attacks involving conventional weapons, Bloomberg reports.

The current law is set to expire at the end of the year. Congress renewed the law in 2005 and 2007.

"(The extension) will continue to promote job creation and provide certainty for businesses, both small and large, and for those who manage commercial properties, including stadiums, hotels, universities and malls throughout the country," Sen. Tim Johnson (D-S.D.), the chairman of the Senate Banking Committee, said, according to Bloomberg.

Reps. Randy Neugebauer (R-Texas) and Jeb Hensarling (R-Tex.) said they want to reduce the government's involvement in serving as a re-insurer for terrorism risk insurance. Neugebauer and Hensarling are drafting a bill that would maintain many current features of the program for CBRN attacks, but it would deny reimbursement to insurers for losses from terrorism by conventional weapons until claims reached $500 million throughout the industry, Bloomberg reports.

"I have been struck over the last few months about the discussion of conventional terrorist attacks," Schumer said, according to Bloomberg. "It's sort of an oxymoron. Not using a nuclear weapon doesn't mean it is not a terrorist attack."