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Bush pushes for terror insurance bill

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WASHINGTON (CNN) -- After this week's success in getting the Senate and House to pass a resolution authorizing military force against Iraq, if necessary, U.S. President George W. Bush sought a bipartisan effort Saturday for a terrorism insurance bill before Congress recesses later this month.

In his weekly radio address, Bush said many insurance companies had stopped covering construction and real-estate projects -- or made premiums prohibitively high -- in the wake of the September 11attacks. The situation, he said, "has hurt the growth of this economy and cost American jobs."

"The lack of terrorism insurance has delayed or canceled more than $15 billion in real-estate transactions," he said. "And more than 300,000 carpenters, joiners, bricklayers, plumbers, and electricians and laborers and other building professionals who could have good-paying jobs have been out of work."

start quoteThe lack of terrorism insurance has delayed or canceled more than $15 billion in real-estate transactions.end quote
-- President Bush in radio address

At issue is proposed legislation that would make the federal government a safety net for insurance companies in the event of another terrorist attack. Both houses have passed versions of the bill -- the House in December 2001 and the Senate in June.

The House version requires insurers to pay for the first $1 billion in claims stemming from a terrorist attack; the federal government would offer long-term loans to help pay for the rest.

The Democrat-backed Senate bill requires insurers to pay for the first $10 billion out-of-pocket. The federal government would pay for 90 percent of any remaining claims.

The key sticking point in negotiations to reconcile the two versions is a Republican insistence on barring punitive damages against private parties, a provision Democrats support.

"Clearly, we're able to get things done in Washington when we focus on getting results, rather than scoring political points," Bush said. "For the good of the economy, for the good of workers who needs jobs, senators should again put politics aside and take one last step to reach a final agreement on terrorism insurance."

The president said the bill would "mean thousands of new jobs ... and billions in new investments" and would make it possible "to compensate victims quickly and limit the economic damage to America" if another attack occurs.

But some consumer advocacy groups, like the Consumer Federation of America, contend the insurance industry has exaggerated its problems after September 11 and urged Congress to reconsider the bill from the beginning.

"The best thing that Congress could do right is to go back to the drawing board and offer targeted assistance to the relatively few businesses that can't get terror coverage, like some skyscrapers," said Travis Plunkett, CFA's legislative director.

"At the very least, negotiators need to eliminate the giveaways in the bill, require insurers to pay their fair share, reduce costs for taxpayers and make sure that they don't choke the fast-developing market for terror insurance."

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