Terrorism Insurance: Subsidy is Corporate Welfare

2 Pages Posted: 1 Jan 2008

See all articles by Robert J. Rhee

Robert J. Rhee

University of Florida Levin College of Law

Date Written: December 3, 2007

Abstract

This is an opinion editorial published in the National Law Journal. It argues that subsidized terrorism insurance is corporate welfare. Consistent with the findings of the Congressional Budget Office, subsidized insurance does not reduce the cost of terrorism, but instead shifts the cost from insurance companies and corporations to the American taxpayers. Moreover, subsidized insurance over the long term tends to increase the cost of terrorism because premiums are not sensitive to mitigation efforts. Thus, subsidized terrorism insurance runs counter to the national interest.

Keywords: terrorism insurance, terrorism, terrorism risk, Terrorism Risk Insurance Act, subsidized insurance, insurance

JEL Classification: E6, G2, H2, H5, K1, K2, L5

Suggested Citation

Rhee, Robert J., Terrorism Insurance: Subsidy is Corporate Welfare (December 3, 2007). Available at SSRN: https://ssrn.com/abstract=1079563 or http://dx.doi.org/10.2139/ssrn.1079563

Robert J. Rhee (Contact Author)

University of Florida Levin College of Law ( email )

P.O. Box 117625
Gainesville, FL 32611-7625
United States

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