Under TRIA, what is the federal assistance cap for terrorism insurance annually?

The federal assistance cap under the Terrorism Risk Insurance Act (TRIA) is set at $100 billion annually. This means that in the event of a certified act of terrorism, the federal government will provide backstop insurance coverage up to this amount. The purpose of this cap is to ensure that insurance companies can offer policies that cover terrorism risk without being overwhelmed by large payouts in the event of a significant attack.

The cap is essential for guaranteeing that there is a limit to federal exposure while still encouraging the insurance market to develop and offer terrorism risk insurance. This balance helps stabilize the insurance industry and protects policyholders.

Understanding the specific financial limits laid out in TRIA is critical for adjusters and insurance professionals, as they shape how claims are processed and how policies are structured regarding terrorism coverage.