Cites conditions for Federal payments. Mandates insurer participation in the Program.
Sets forth a transition period followed by an initial Program period (January 1, 2003, to December 31, 2005) during which insurers must make available: (1) coverage for insured losses in all property and casualty insurance policies; and (2) property and casualty insurance for insured losses that does not differ materially from coverage limitations applicable to losses from events other than acts of terrorism.
Directs the Secretary to promulgate regulations that apply this title to State residual market insurance entities and State workers' compensation funds.
States that the Federal share of compensation for insured losses of an insurer shall be 90 percent of the portion of such losses exceeding the insurer deductible required to be paid during the Program Year.
Prohibits duplicative compensation for insurance losses under any other Federal program.
Caps at $100 billion the annual aggregate insured losses for which either the Secretary or an insurer that has met its insurer deductible shall be liable. Directs the Secretary to determine the pro rata share of insured losses to be paid by each insurer that incurs insured losses under the Program.
Requires the Secretary to notify Congress if estimated or actual aggregate annual insured losses during the Program exceed $100 billion. States that Congress shall determine payment procedures and the source of payments for excess insured losses.
Grants the Secretary sole discretion to determine the time at which claims for insured losses or acts of terrorism become final. States that such determination is final (unless expressly provided) and not subject to judicial review.
Prescribes formulae and other requirements for the: (1) insurance marketplace aggregate retention amount; (2) mandatory recoupment amount of the Federal share; and (3) policyholder premium surcharge for terrorism loss risk-spreading premiums (including certain adjustments for urban and smaller commercial and rural areas and different lines of insurance).
Authorizes the Secretary to apply this title to other types of captive insurers and self-insurance arrangements by municipalities and other entities (such as workers' compensation self-insurance programs and State workers' compensation reinsurance pools), but only if such application is determined before the occurrence of an act of terrorism in which the entity incurs an insured loss and all provisions of this title are applied comparably to such entities.
Provides that this title neither prevents nor limits insurers from obtaining reinsurance coverage for insurer deductibles or insured losses, nor does obtaining such coverage affect the calculation of deductibles or retentions.
Prohibits the combined amount of Federal financial assistance and reinsurance proceeds from exceeding the aggregate amount of the insurer's insured losses for specified periods.
Directs the Secretary to study: (1) whether adequate and affordable catastrophe reinsurance for acts of terrorism is available to issuers of group life insurance, and the extent to which the threat of terrorism reduces the availability of group life insurance for consumers; and (2) the potential effects of acts of terrorism on the availability of life insurance and other lines of insurance coverage, including personal lines.
(Sec. 104) Cites the powers and authorities granted to the Secretary for Program implementation, including authority to assess a civil monetary penalty against any insurer for violation of this title.
Makes appropriations for Federal payments and administration expenses under the Program.
(Sec. 105) Preempts and nullifies any pre-existing terrorism exclusion clause in a property and casualty insurance contract (including a State-approved contract) to the extent that it excludes losses that would otherwise be insured losses. Allows reinstatement of such exclusion, however, upon an affirmative written authorization from the insured, or upon the insured's failure to pay an increased premium for terrorism coverage despite due notice from the insurer.
(Sec. 106) Preserves the jurisdiction or regulatory authority of the State insurance commissioner (or any State agency or office performing like functions over any insurer), except as specifically provided in this title.
(Sec. 107) Declares that a Federal cause of action is the exclusive cause of action and remedy for claims for property damage, personal injury, or death arising out of, or resulting from an act of terrorism (thus preempting a State cause of action).
(Sec. 108) Sunsets the Program on December 31, 2005.
Directs the Secretary to study and report to Congress on: (1) Program effectiveness and the likely capacity of the property and casualty insurance industry to offer terrorism risk insurance after Program termination; and (2) the availability and affordability of such insurance for various policyholders, including railroads, trucking, and public transit.
Title II: Treatment of Terrorist Assets - (Sec. 201) Subjects to execution or attachment in aid of execution the blocked assets of terrorists (including terrorist organizations and state sponsors of terrorism) in order to satisfy a judgment on a claim based upon an act of terrorism, to the extent that the parties have been adjudged liable for compensatory damages.
Permits a Presidential waiver (with certain exceptions) of such attachment against property subject to the Vienna Convention on Diplomatic Relations, or the Vienna Convention on Consular Relations, after the President determines on an asset-by-asset basis that it is necessary in the national security interest.
Amends the Victims of Trafficking and Violence Protection Act of 2000 to: (1) revise the time frame under which certain claimants who filed suit are considered eligible for payment in connection with certain anti-terrorism judgments against Iran or Cuba; (2) prescribe guidelines for the distribution of account balances and proceeds inadequate to satisfy the full amount of compensatory awards against Iran; and (3) authorize the Secretary to promulgate guidelines for establishing claims of a right to payment.
Title III: Federal Reserve Board Provisions - (Sec. 301) Amends the Federal Reserve Act to state that certain actions that currently require the affirmative vote of five members of the Board of Governors of the Federal Reserve System may nevertheless be taken upon the unanimous vote of all members then in office if fewer than five.
Authorizes the Board to take action upon the unanimous vote of all available members then in office with respect to discounts for individuals, partnerships, and corporations, if at least two members are available, all available members participate in the action and unanimously determine that: (1) unusual and exigent circumstances exist and the borrower is unable to secure adequate credit accommodations from other sources; (2) action on the matter is necessary to prevent, correct, or mitigate serious harm to the economy or the stability of the financial system of the United States; (3) the other Board members have not been able to be contacted and action is required before the number of Board members otherwise required to vote on the matter can be contacted; and (4) any credit extended by a Federal reserve bank pursuant to such action is payable upon demand of the Board.
Mandates Board documentation of such determinations.