As published in Scotsman Guide's Commercial Edition, February 2006.
News happens. And sometimes, it's even good.
Such was the case in late December 2005, when President Bush signed a two-year extension to the expiring Terrorism Risk Insurance Act (TRIA). Just days before, Scotsman Guide's January commercial edition went to press with an article from the Building Owners and Managers Association stressing the federal program's importance.
Its importance boils down to this: Between the events of Sept. 11 and TRIA's inception in 2002, the nation saw insurers grow hesitant. Which gave pause to banks and lenders. Which slowed commercial-loan production. Which hurt.
By instituting a federal program to share risk with the private sector, TRIA created and now helps maintain stability in our industry. The extension -- pushing TRIA's expiration from this past Dec. 31, to Dec. 31, 2007, in addition to raising industry deductibles and the minimum losses for which payments are available -- essentially buys time until we reach a long-term solution.
In the meantime, we have the luxury of focusing on other issues -- such as those on the plate at this month's Mortgage Bankers Association's Commercial Real Estate Finance/Multifamily Housing Convention and Expo, which we preview this edition. MBA Chairwoman Regina Lowrie outlines more, as well, in our Q&A.
And yes, it's true that we've yet to see a domestic incident in which TRIA would come into play. We've been fortunate.
After TRIA's extension, perhaps even more so.