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  3. Of all the catastrophes that could befall America in coming years, a big terrorist attack, perhaps even bigger than those on Sep

Of all the catastrophes that could befall America in coming years, a big terrorist attack, perhaps even bigger than those on Sep

admin2010-12-21  91
问题    Of all the catastrophes that could befall America in coming years, a big terrorist attack, perhaps even bigger than those on September 11 th 2001, may be more likely than others. Who would pay for the millions in property damage, business losses and other claims from such an attack?
   This is the question with which America’s Congress is currently wrestling. The Terrorism Risk Insurance Act (TRIA) was passed as a temporary measure after September 11th to provide a government back-stop for the insurance industry in the event of a catastrophic attack. It now says government can step in when insured losses from a terrorist event top $5m. TRIA has helped to stabilize the market, and enabled insurers to continue offering terrorism-risk cover even after swallowing the big losses imposed by September llth. But unless Congress acts last, TRIA will expire at the end of the year. One likely result is the loss of terrorism-risk cover for thousands of firms and property owners. This, in turn, could disrupt businesses and make some commercial activity impossible. With modifications, TRIA should be extended.
   The Bush administration has been opposed to extension. It has always seen TRIA as a short-term measure, and has argued that the private sector should assume sole responsibility for terrorism insurance. This is the right goal. A purely private solution would be best, lifting any future burden-from the taxpayer and relying on the industry to price and spread risks more accurately than any government can do. But relying entirely on the private sector immediately does not look feasible. With TRIA’s expiration looming, insurers and reinsurers have not, as the administration expected, rushed to write new contracts for next year offering to fall gaps in terrorism cover.
   Why the hesitation? Unlike other risks, the threat of terrorism cannot be forecast in time or scope, making a mocker’:" of insurers’ underwriting models. A big chemical, biological or nuclear attack is a prospect few can price, or afford to cover. Insurers are already being threatened with downgrades by rating agencies for the terrorism cover they have sold.
   One reason is that insurance, far from being a free market, is already one of the most heavily regulated of industries. Operating in a highly distorted marketplace, with 50 state regulators, the insurance industry seems to be having trouble pricing the largest of terrorism risks in a way that is credible and can still offer insurers a profit. Letting TRIA expire, and abruptly withdrawing the government role in insuring the largest losses, would just exacerbate this problem.
   Any renewal of TRIA should, once again, be limited to two years, say. Its extension must also shift more of the burden, and the business, to the private sector. If an extension is agreed and TRIA’s threshold for government intervention is raised substantially, work should begin now to find better longer-term solutions. One place to look is abroad, where governments have dealt with terrorism risk for years. In Britain, for instance, insurers have created a pool of capital that is backed by the government and, over time, shifts a greater share of risk on to the private sector. Other options to consider include tax changes that reduce the cost of holding capital by insurers and reinsurers, and facilitating the use of catastrophe bonds.
   With fewer regulatory distortions of insurance markets, a solely private solution may be attainable in the long run. In the current environment, though, the same government that regularly warns of terrorist threats must still have a role to play in a solution that safeguards America’s financial security. It would be better to plan ahead than wait for a rushed, Katrina-style bail-out after a big attack. Amid all the uncertainties, one thing seems clear: any such bail-out would be more costly and lead to even greater market distortions without an extension of the Terrorism Risk Insurance Act today.
TRIA ______.
选项 A、provides insurance to properties in high-risk areas
B、should be extended as it is now
C、requires government support to risk insurance
D、has caused a substantial loss of revenue to the state
答案C
解析 根据第二段可知，TRIA是政府实施的一项灾难袭击后provide a government back-stop for the insurance industry措施，由政府财政支持保险业，而不是“向高危地区房地产提供保险”，选项C正确。从第二段可知，With modifications, TRIA should be extended，而不是保持现状来延期，选项B不正确。
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