The US insurance industry has welcomed the approval by Congress of legislation which will see the Terrorism Risk Insurance Act (TRIA) extended by at least two years.

While the Senate had already approved its own version of an extension, the industry was keen to see if Congress would follow suit. It’s now up to Congress and the Senate to try to create a single version of their individual bills and vote it in before the original legislation’s expiry date of December 31.

TRIA – a temporary Government initiative introduced in a bid to spread the costs of any future terrorism attacks – was passed a year after the September 11 terrorist attacks.

Lloyd’s and other industry players have welcomed the renewal of the Act, saying that “while TRIA may not be the panacea”, there is no doubt that there needs to be government involvement in providing a backstop of some sort of assistance for this risk.

But President George W Bush’s administration “strongly opposes” the continuation of the legislation, issuing a formal statement saying it should be up to business owners to “find new ways to diversify the risks of doing business”.

Lloyd’s said in a statement that future terrorist attacks are likely, and that’s why it’s important for the US government to initiate legislation like TRIA and other catastrophe pools.

The Independent Insurance Agents & Brokers of America, a long-time supporter of the extension of the legislation, says the “legislation is crucial for the business customers of independent agents and brokers, for continued economic growth in America, and for our nation’s economic security”.