The House Financial Services Committee has cleared a bill to extend the federal terrorism insurance backstop for 15 years. Industry groups praised the action, but the Bush administration said it strongly opposes the bill.

The measure, which the panel approved on Aug. 1 on a 49–20 vote, would require insurers to offer coverage for terrorist acts involving nuclear, biological, chemical or radiological weapons. It also would add group life to the insurance lines eligible for the federal program.

The backstop was established under the 2002 Terrorism Risk Insurance Act. Before that statute expired at the end of 2005, Congress extended it through 2007.

David Nason, assistant Treasury secretary for financial institutions, said the administration is strongly opposed to the committee's bill. He singled out the extension for 15 years for particular criticism. "It sends the wrong message to the marketplace for a program that was intended to be temporary," Nason says.

There has not yet been any action yet in the Senate. m