1. Forms
2. IL
3. IL-09-99

What the form is

The IL 09 99, titled "Disclosure Of Premium And Estimated Premium For Certified Acts Of Terrorism Coverage (Pursuant To Terrorism Risk Insurance Act)", is a mandatory form used in commercial insurance. Its primary purpose is to provide transparency to the policyholder regarding the premium charged for coverage of "certified acts of terrorism" as defined under the federal Terrorism Risk Insurance Act (TRIA) and its subsequent reauthorizations. The form details the amount of the policy's premium that is attributed to terrorism coverage and explains the federal program's backstop mechanism, including the federal share of compensation for such losses.

Classes of business it applies to

This disclosure form applies broadly across most commercial lines of insurance that are subject to TRIA. This includes, but is not limited to:

• Commercial General Liability
• Commercial Property (including Building and Personal Property, Business Income)
• Commercial Package Policies
• Commercial Auto

Essentially, any commercial enterprise purchasing insurance that falls under the scope of TRIA would receive this disclosure. For example, a manufacturing company, a real estate firm, a non-profit organization, or a retail business would all encounter this form when obtaining relevant commercial insurance policies.

Special considerations

Key considerations for the IL 09 99 include:

• Mandatory Nature: Compliance with TRIA's disclosure requirements is compulsory for insurers. This form fulfills that obligation.
• No Coverage Alteration: The IL 09 99 is a disclosure form; it does not alter or grant coverage. The terms of terrorism coverage itself are found within the policy or specific terrorism endorsements.
• Definition of "Certified Act of Terrorism": Coverage and the applicability of TRIA (and thus this disclosure) hinge on an event being formally "certified" as an act of terrorism by the Secretary of the Treasury, in concurrence with the Secretary of State and the Attorney General.
• Federal Backstop: The form refers to the federal program where the government shares in insured losses from certified acts of terrorism once insurer deductibles and industry retentions are met.

For instance, if a commercial property policy includes coverage for terrorism, the IL 09 99 will specify what portion of the total premium is for that terrorism coverage. This allows the policyholder to understand the cost associated with this specific peril.

Key information for agents and underwriters

For Agents:

• Ensure this form is included with all new and renewal commercial policies subject to TRIA.
• Be prepared to explain to clients what TRIA is, what a "certified act of terrorism" means, and how the premium disclosure works.
• Emphasize that this form is informational and does not change the policy's coverage.

For Underwriters:

• Verify that the premium allocated for terrorism coverage is accurately calculated and disclosed on this form.
• Understand the insurer's obligations under TRIA, including the "make available" provision for terrorism coverage.
• While this form is a disclosure, the underlying pricing and availability of terrorism coverage are significant underwriting considerations, especially for risks with higher terrorism exposure.
• Stay updated on TRIA reauthorizations and any changes to the program, as these can impact disclosure requirements and the federal share of losses.