Law Commons^™

Terrorism Risk Insurance Act: Time To Renew . . . Or Rethink?, Jeffrey E. Thomas

Faculty Works

This paper summarizes the U.S. program for terrorism insurance, outlines its advantages and disadvantages, and describes the current proposals for extension of the program. The program, generally referred to as a “Federal Backstop,” functions in some ways that are similar to reinsurance, but it does not require participants to pay premiums ex ante. Instead uses an ex post recoupment mechanism to recover some or all of the Federal payments made under the program. This approach has the advantage of reducing the cost and increasing the availability of terrorism insurance. Some have criticized the program for its interference in market mechanisms, …

Government Support For Terrorism Insurance, Thomas Russell, Jeffrey E. Thomas

Faculty Works

Federal government support for the terrorism insurance industry has a very brief history. Prior to 9/11, insurers did not take terrorist-related losses into account when underwriting risks. The industry did not even conceive of an attack that could generate such significant losses. The dramatic shift in perception since then has caused many to suggest that terrorism risks are uninsurable. The notion that terrorism risk was uninsurable was part of the rationale advanced for government intervention. When the initial efforts at legislation failed, the industry began to withdraw from the market by adding exclusions for terrorism-related losses to their policies. Reinsurers …

Supreme Court Report 2007-2008, Julie M. Cheslik, Aimee L. Morrison, Tyler J. Scott

Faculty Works

This article reviews the decisions of the U.S. Supreme Court for the 2007-2008 Term that are of particular relevance to state and local governments including those involving voting and elections, speech, class-of-one equal protection claims, immunity, taxation, preemption, and the Fourth and Sixth Amendments.

Against the backdrop of the 2008 presidential election between Democrat Barack Obama and Republican John McCain, and an economy plagued by recession and federal bailouts of the finance and mortgage industries, the Court continued in a largely conservative vein, reflecting the policies and predilections of the majority of justices. The Court reasserted its distaste for unfettered …

The Trial Of Zacarias Moussaoui, Douglas O. Linder

Faculty Works

On the horrific morning of September 11, 2001, when planes crashed into buildings and fell from the sky, Zacarias Moussaoui was sitting in a jail in Minnesota facing immigration charges. Even if he had not been arrested three weeks earlier, when he raised suspicion by paying large sums to a flight training school to learn to pilot a Boeing 747 despite his never having piloted a small plane, it seems unlikely that Moussaoui would have been the twentieth hijacker on one of the four doomed planes. Nonetheless, largely because of the convenient fact that he was alive and in custody, …

The Oklahoma City Bombing And The Trial Of Timothy Mcveigh, Douglas O. Linder

Faculty Works

A bomb carried in a Ryder truck exploded in front of the Murrah Federal Building in Oklahoma City at 9:02 a.m. on April 19, 1995. The bomb claimed 168 innocent lives. That a homegrown, war-decorated American terrorist named Timothy McVeigh drove and parked the Ryder truck in the handicap zone in front of the Murrah Building there is little doubt. In 1997, a jury convicted McVeigh and sentenced him to death. The federal government, after an investigation involving 2,000 agents, also charged two of McVeigh's army buddies, Michael Fortier and Terry Nichols, with advance knowledge of the bombing and participation …

High-Powered Controversy: Gun Control, Terrorism And The Fight Over .50 Caliber Rifles, Allen K. Rostron

Faculty Works

Near the end of the First World War, the German army introduced powerful new anti-tank rifles, and the U.S. military realized that it needed a similar weapon. Legendary American firearm designer John Browning answered the call by developing a heavy-duty machine gun and a new type of .50 caliber ammunition for it. Although rapid improvement in armor plating soon made it obsolete as an anti-tank weapon, Browning's machine gun proved to be enormously successful when deployed against personnel and less heavily armored vehicles. Military forces throughout the world continue to use it today. The ammunition for this gun became known …

Exclusion Of Terrorist-Related Harms From Insurance Coverage: Do The Costs Justify The Benefits, Jeffrey E. Thomas

Faculty Works

The September 11 attack was the largest single insured event in history. In the end, insurance companies are expected to pay approximately $50 billion to victims of the attack. In response to the perceived potential of future terrorist losses, many insurers have begun to exclude terrorist-related losses from their policies. In light of the size and uncertainty of future losses, this is understandable. In adopting this approach, however, it appears that little thought has been given to the transaction costs associated with the exclusion. One of the significant contributions of Law and Economics to legal literature has been to illuminate …

Insurance Implications Of September 11 And Possible Responses, Jeffrey E. Thomas

Faculty Works

September 11 was a "defining moment" for this generation. The graphic images of that day will forever remain seared into people's individual and collective consciousness. Americans responded in many ways, both individually and collectively. The government, with nearly unanimous public support, immediately responded by declaring "war" on terrorism and by adopting measures to provide relief for victims of the attack.

September 11 was also a defining moment for the insurance industry. It was "the largest single insured event in history." Insurance companies are expected to pay some $50 billion to victims of the attack -more than eight times what the …