$26 Billion at Stake without Federal Terrorism Insurance

WASHINGTON, DC-Based upon new data, the Mortgage Bankers Association warns that $26 billion in fourth quarter commercial real estate financings could be in jeopardy without federal terrorism insurance. Pointing out the real estate industry’s vital role in the national economy, MBA calls on the government to expedite the development of relevant legislation, as the threat of more domestic attacks looms.

Association Chairman James M. Murphy explains, “without terrorism insurance coverage, commercial lenders will be forced to either delay or prevent real estate projects from going forward. That could include everything from financing, buying or selling a shopping center to constructing a new office or apartment building.” Already, many insurance brokers in major metropolitan areas are excluding terrorism coverage from future policies. MBA urges legislators to devise a program that would include a federal reinsurance backstop, and a cap on total losses for the private and public sectors.