Money Laundering, Terrorism & Financial Institutions
Published by Civic Research Institute,

News Releases

12 Jul 2003   Final Terrorism Risk Insurance Rules

Treasury has issued final regulations under the Terrorism Risk Insurance Act of 2002, generally adopting previous interim guidance, but refining certain aspects of the rules. The rebuttable presumption of "control," and thus of an affiliate relationship, where one insurer "directly or indirectly exercises a controlling influence" over another, has been revised in a number of respects. Interim rules had provided that the existence of control under state law was sufficient to create a rebuttable presumption of controlling influence. Commenters on the interim rules had objected to the presumption because of varying state standards for determining control, and Treasury has modified the concept to provide that the rebuttable presumption arises only if state law "control" is accompanied by at least one of eight specified factors. The final rules include a more detailed description of a controlling influence hearing, where an insurer can attempt to rebut a presumption of a control relationship. A proposal, backed by some in Congress, to allow captive insurers to opt into the Terrorism Risk Insurance Program, was rejected. More details on the final rules and the Program will be provided in the next issue of the USA PATRIOT Act Monitor.

The editors and contributors to the Monitor wish to inform our subscribers that a website for the Monitor, and for materials relating to Money Laundering, Terrorism and Financial Institutions, is nearing completion. We will be notifying subscribers of procedures to obtain passwords to the website in the coming weeks.

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