Terrorism insurance bill signed

? President Bush signed a bill Tuesday that would reimburse the insurance industry up to $100 billion in a future terror attack.

Bush said the bill would boost the economy, but critics called it a taxpayer-financed gift to insurance companies.

The Sept. 11, 2001, attacks drained an estimated $40 billion from the insurance industry’s roughly $210 billion in reserves, and companies told the White House last year they could not withstand another such blow.

Bush campaigned for the bill as he stumped for GOP candidates this fall, asserting that failure by lawmakers to pass a terrorism insurance bill had stalled $15 billion in construction projects because companies were reluctant to finance projects that couldn’t get insurance.

Bush’s figure came from Real Estate Roundtable, a trade group for property and development firms, and he repeated it Tuesday.

“Commercial construction is at a six-year low, and thousands of hard-hat workers have been kept off the job,” he said in a signing ceremony. “Should terrorists strike again, we have a system in place to address financial losses and get our economy back on its feet as quickly as possible.”

But the Consumer Federation of America said insurance is currently available to “all but the highest risks, such as skyscrapers, rates are falling and banks are lending freely.”

“It is shocking that Congress and the president accepted the wild claims made by insurance and real estate lobbyists at face value,” said J. Robert Hunter, the group’s director of insurance.

The insurance industry was among Bush’s top 10 largest donors in his 2000 presidential campaign, contributing more than $1.6 million.

Under the new law, the government could aid the industry on terrorism-related claims that surpassed $5 million. Insurance companies would pay deductibles ranging from 7 percent to 15 percent of the premiums they received the previous year. The federal government would then cover 90 percent of everything above the deductible with the companies paying the other 10 percent. The program would be capped at $100 billion over three years.