Examkin

Soru

Zorluk: OrtaTerrorism Risk Insurance Act (TRIA)

During an annual risk assessment, an executive team at a commercial property and casualty insurance company evaluates its potential exposure to catastrophic events. The team is analyzing the company's financial responsibilities under the Terrorism Risk Insurance Act (TRIA) in the event of a large-scale, coordinated attack on several insured commercial buildings. Which of the following accurately describes how the administrative roles and financial mechanisms function under this federal program?

  1. A
    Once an event is federally certified, the federal government acts as the primary insurer by directly indemnifying the policyholders, thereby relieving the commercial insurance company of any claim settlement duties.
  2. The Secretary of the Treasury, in consultation with other specified federal officials, certifies the act, after which the insurer pays covered claims up to a statutory deductible before the federal government reimburses a percentage of the remaining losses.Cevap
  3. C
    The State Insurance Commissioner determines whether the event qualifies as an act of terrorism, which then triggers the state guaranty association to pay all resulting property claims.
  4. D
    TRIA acts as a solvency mechanism that directly bails out insurers facing bankruptcy from terrorism claims, rather than providing a backstop for the actual losses suffered by the policyholders.

Cevap

The Secretary of the Treasury, in consultation with other specified federal officials, certifies the act, after which the insurer pays covered claims up to a statutory deductible before the federal government reimburses a percentage of the remaining losses.
The correct answer accurately reflects the two main pillars of TRIA's post-event operation: the federal certification process led by the Secretary of the Treasury, and the loss-sharing financial mechanism where the primary insurer must first meet a deductible before the federal backstop provides percentage-based reimbursement for excess losses.

Adım Adım Çözüm

1
Identify the authority responsible for certifying an act of terrorism under TRIA.
The Secretary of the Treasury, in consultation with the Secretary of Homeland Security and the Attorney General, has the sole authority to certify an event as an act of terrorism.
Understanding jurisdiction is critical; state authorities do not have the power to trigger federal TRIA provisions.
2
Determine the financial structure and the role of the federal government versus the primary insurer.
The primary commercial insurer remains the direct point of contact and must process the claims. They pay out losses up to a specified statutory insurer deductible.
TRIA does not replace primary insurance; it requires insurers to make coverage available and process the resulting claims.
3
Analyze how excess losses are handled once the insurer's deductible is met.
Once the deductible is met, the federal government steps in to reimburse the insurer for a statutorily defined percentage of the remaining losses, acting as a financial backstop.
This loss-sharing mechanism is the core feature of TRIA, designed to stabilize the commercial insurance market without the government taking over direct insurance duties.

Anahtar Kavram

Terrorism Risk Insurance Act (TRIA) Mechanics and Certification
Tahmini Süre:1m 30s
Bu soruyu puanla

Konular

Terrorism Risk Insurance Act (TRIA)

Bu konudan daha fazla soru