WASHINGTON, DC-Now that the Terrorism Risk Insurance Act of 2002 has been signed into law, The US Department of the Treasury has issued interim guidance for the insurance industry in meeting the legislation’s requirements. In working out the final guidelines of the law’s implementation, Treasury officials are meeting with relevant groups to sort out the details. The Mortgage Bankers Association of America’s Insurance Task Force–which consists of representatives from every corner of the commercial real estate finance world–is one of the groups that will have input. MBA commercial/multifamily senior vice president Gail Davis Cardwell talks to GlobeSt.com about what pertinent issues the task force will present to Treasury officials in a scheduled December 16 meeting.

“Our purpose in meeting with the Treasury Department is to assist them in working through implementation issues affecting the commercial real estate finance industry,” Cardwell tells GlobeSt.com. “MBA has held a series of conference calls to facilitate a smooth and pragmatic implementation of the federal act’s provisions, working in close conjunction with Treasury Department officials.” First up is the issue of the insurance notification process. “Because the commercial/multifamily mortgage industry are parties to the insurance contract, we want to ensure that we are recognized in the insurance notification process to facilitate and expedite the procurement of adequate and affordable insurance for commercial real estate properties,” explains Cardwell.

Other important matters that will be put on the table include the interrelationship between the federal law and state insurance regulations, and the issue of coverage of losses incurred by domestic-born acts of terrorism. “The federal law does not cover domestic terrorism,” she notes. “We will work with Treasury to ensure that a clear, expeditious certification process is in place to differentiate between foreign interest and domestic, so that insurance coverage can be placed expeditiously.” Looking ahead at the long-term implementation of the new law, a Terrorism Risk Insurance Program Office will be established to handle much of the Treasury’s responsibilities as dictated by the legislation.

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