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Abstract

This study simulates the expected losses from three modes of terrorist attacks and shows how the Terrorism Risk Insurance Act (TRIA) would distribute the resulting losses. It finds that losses vary substantially in size and distribution by insurance line across the scenarios. It further finds that under TRIA, a large share of the losses would be uninsured and that of those losses eligible under TRIA, taxpayers would not pay for any losses from a single attack in any of the scenarios. Based on these findings, the study offers some conclusions and implications.

The RAND Center for Terrorism Risk Management Policy is a joint project of RAND Infrastructure, Safety, and Environment; RAND Institute for Civil Justice; and Risk Management Solutions.

This report is part of the RAND Corporation research brief series. RAND research briefs present policy-oriented summaries of individual published, peer-reviewed documents or of a body of published work.

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