Congress Rips Off Consumers Over Terror Insurance

| December 2, 2002

While most corporate corruption quietly snuck away in the chaos of the War on Terrorism, the newest scandal is directly related to the terrorist attacks - and worse, the U.S. government.

What started as a government loan to insurances companies in the event of a catastrophic terrorist attack, explains Lucy Komisar of Pacific News Service, has become a federal handout gift-wrapped by Democrats and Republicans with close ties to the industry. The Terrorism Risk Insurance Act will pay out insurance company claims for losses up to $100 million, triggered once the industry sustains only $5 million in terror losses. Seems legitimate? Not considering the original policy proposed by the House could not be triggered until the industry claimed $1 billion in losses. And worse, it's taxpayers that must pick up most of the cost.

Supporters for the bill claim that, after September 11th, companies can't get terrorism insurance as easily, causing the construction and real estate markets to dry up. But, according to Robert Hunter of the Consumer Federation of America, the opposite is true: only the high-end real estate sector is having trouble getting terror insurance, and most every other business in America is covered. The insurance industry, Hunter adds, is doing just fine financially.

While insurers took a significant blow directly after 9/11, profits shot up by over 65% halfway through 2002.While insurance companies are getting breaks from the government, individuals unemployed or injured by the attacks are getting very little aid to help them carry on. And as usual, not much of the press is talking about this imbalance. The insurance companies are pleased, laments Komisar. Taxpayers, kept in the dark by media disinterests, should not be.

--Abbie Jarman
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