With the expiry date for the US Terrorism Risk Insurance Act (TRIA) looming, the many interested parties involved in the issue are getting noisy in their calls for an extension to the Bush Government’s terrorism insurance scheme.

In testimony last week before the House Financial Services Committee and the Senate Banking Committee, US Treasury Secretary John Snow said the TRIA had met its goal of “stabilising the private insurance market”, but the Government would not support extending the legislation.

“Extending the TRIA in its current form is likely to discourage the private market development needed to deal with the risk of terrorism,” he said.

Mr Snow says if the legislation is extended, it should provide a far narrower range of coverage with a higher threshold.

“The Bush administration would accept an extension only if it includes a significant increase to $US500 million of the event size that triggers coverage… and eliminates from the program certain lines of insurance such as commercial auto, general liability and other smaller lines that are far less subject to aggregation risks and should be left to the private market,” he said.

Insurers want the TRIA extended – full stop. The US National Association of Insurance Commissioners, which represents the state regulators, says the industry needs time to put in place a “long-term strategy”.

“The removal of [the TRIA] could return the insurance market to the uncertainty experienced in the aftermath of September 11,” New York Superintendent of Insurance Howard Mills said.

The commercial real estate industry is also putting pressure on the Government to renew the legislation, saying the removal of the protection will see coverage drop and premiums rise, destabilising the commercial property market.