Terrorism Risk Insurance Extension Act of 2005

(This measure has not been amended since it was passed by the Senate with an amendment to the House passed version on December 16, 2005. The summary of that version is repeated here.)

Terrorism Risk Insurance Extension Act of 2005 - Amends the Terrorism Risk Insurance Act of 2002 to extend the terrorism risk insurance program from 2005 through 2007.

Defines Program Year 5 as ending on December 31, 2007.

Excludes from covered lines of insurance: (1) commercial automobile insurance; (2) burglary and theft insurance; (3) surety insurance; (4) professional liability insurance; and (5) farm owners multiple peril insurance.

Prescribes formulae for insurer deductibles for Program Years 4 and 5.

Sets the federal share of insured loss compensation for Program Year 5 at 85% (Year 4 is currently 90%) of the amount of insured losses exceeding the applicable insurer deductible.

Specifies for Program Years 4 and 5 increasing maximum aggregate retention amounts in the formula for mandatory recoupment of the federal share of insured loss compensation paid.

States that compensation for a certified act of terrorism occurring after March 31, 2006, shall be paid only if the aggregate industry insured losses exceed either: (1) $50 million occurring in Program Year 4; or (2) $100 million occurring in Program Year 5.

States that procedures and requirements for advance approval of settlements established by the Secretary are applicable to any cause of action for damages in connection with a determination by the Secretary that an act of terrorism has occurred.

Directs the President's Working Group on Financial Markets to analyze and report to certain congressional committees on the long-term availability and affordability of insurance for terrorism risk, including: (1) group life coverage; and (2) coverage for chemical, nuclear, biological, and radiological events.

Written by the nonpartisan Congressional Research Service. All summary versions on Congress.gov