Hiscox has begun targeting small and medium-size US risks that will be left out by increased trigger limits in the Terrorism Risk Insurance Extension Act (TRIEA).

From the beginning of 2007, the trigger point at which the US government will begin funding losses resulting from a terrorist act on US soil by a foreign group will increase from an aggregate per-event loss of $50 million to $100 million. The deductibles carried by US insurers offering TRIEA cover will also increase from 17.5 percent of the prior year’s direct earned premiums to 20 percent.

Hiscox believes there is an opportunity to provide coverage to clients of smaller US insurers currently offering terrorism cover under TRIEA that may not have the security in place to retain the increased retentions and continue offering coverage in 2007.

"We do think the increased retentions and deductibles imposed in 2007 and the lack of guidance about what happens after will give us an opportunity at the level of small to medium-size businesses where limits are not greater than $50 million and premiums are not greater than $50,000," explained Hiscox terrorism underwriter Stephen Ashwell.