KUA Board to Consider Purchase of Terrorism Insurance

Placeholder image

KISSIMMEE, Fla., January 31, 10:30 am – The Kissimmee Utility Authority (KUA) Board of Directors will hold a special meeting on February 5 to consider the purchase of terrorism insurance to protect the utility’s $360 million infrastructure from a potential attack.
“Immediately after the attacks of September 11, 2001, many insurers announced to us that they did not intend to provide coverage for acts of terrorism in future contracts,” said Joseph Hostetler, KUA’s Vice President of Finance & Risk Management. “This led to a concerted effort by utilities nationwide to seek assistance from the U.S. Congress to address this issue.”
KUA’s ability to purchase the insurance is made possible by the Terrorism Risk Insurance Act of 2002 which was signed by President Bush on November 26, 2002. The Act provides coverage for catastrophic losses from terrorist attacks.
The new law provides for a system of shared public and private compensation for insured commercial property and casualty losses arising from acts of terrorism. Under the plan, 90% of the losses above the policy deductible would be covered by the federal government with the insurer paying the remaining 10% of losses. The program is administered by the U.S. Treasury Department and will remain effective through December 31, 2005. KUA’s cost to purchase the policy totals $114,153.
The policy, however, does not include acts committed in the course of a war declared by the U.S. Congress.
KUA operates two power generation facilities – Cane Island Power Park and Roy E. Hansel Generating Station – that serve the energy needs of Osceola County residents as well as the residents of 14 other cities throughout Florida.
Founded in 1901, KUA is Florida’s 6th largest community-owned utility serving 58,000 electric, water and internet customers in four Central Florida counties.
# # #
Contact: Chris Gent, Manager of Corporate Communications
(407) 933-7777 ext. 1116
cgent@kua.com