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Commercial property owners will continue to have protections against acts of terrorism if Congress approves a new extension to the Terrorism Risk Insurance Act. The legislation, which was adopted in 2002 following the September 11, 2001 terrorist attacks, guarantees coverage from providers in the aftermath of incidents that qualify as terrorism. Experts say legislators are likely to extend the act for at least a year, and possibly up to six years. 

While the United States has been successful in averting and preventing more major terrorist attacks since 9/11, the possibility of destruction prompted lawmakers to approve protections for businesses. Though rare, the physical toll of terrorism could sink commercial, financial and industrial operations if their providers decline to cover losses. After the 2001 attacks, the language of some insurance policies did not manifestly provide for damages sustained in acts of terror, so the act clarifies protocol. 

The law also provides some federal reimbursement to the insurance providers who assist companies reeling from catastrophic incidents. Like a natural disaster, terrorism is impossible to predict and can inflict damage even the most careful precautions can't prevent. In 2001, the terrorism-insurance market was rocked by inflated rates that made coverage impossible for some companies to afford, prompting government intervention. In total, the 9/11 attacks created $32.5 billion in insured losses. A lack of confidence in terrorism insurance also threatened to derail development projects, as firms felt uncertain about commercial risk management in the future. 

Though business owners, particularly those in New York, Washington, D.C., and other major metropolitan areas are disturbed to imagine the human and commercial toll of terrorism, it's important for operations to understand their protections under the law. Congress will arrive at a decision on TRIA by the middle of December, according to MarketWatch.