The US Government has finally got a plan to supplement terrorism claims as far as the fractious Congress. The structure of the scheme was finally agreed last week between White House and congressional negotiators. Congress will vote on the legislation on November 12.

Under the US scheme, the Government will cover 90% of insurers’ losses over $US10 billion, up to a limit of $US100 billion.

Insurers will cover a basic minimum of claims equal to 7% of their annual gross premiums in the first year, 10% in the second and 15% in the third. The Government will cover 90% of losses that exceed these percentages.

The Government will recoup its payouts from insurers below an industry-wide loss of $US10 billion in the first year, $US12.5 billion in the second and $US15 billion in the third. Any Government payout below these levels will therefore effectively be a loan.