WASHINGTON — Railroads, developers, bond holders, landholders and insurance companies predict stalled projects, broken contracts, loan defaults and plenty of lawsuits if Congress fails to pass a terrorism insurance bill within the next few days.

Legislation to provide government assistance to insurers for future terrorist acts is stalled, with the odds of enactment "well south of 50-50," according to Democratic Sen. Jon Corzine of New Jersey.

While there is wide agreement in Congress that the government needs to help make insurance for terrorism available, Republicans insist on adding limits on lawsuits that can be filed in terrorism attacks and Democrats won't go along.

Lack of a bill by Jan. 1, when 70 percent of property and casualty policies expire, will stop many real estate development projects and throw some loans into default because insurance is a requirement for most financing.

"Deals will just stop happening," said Stephen Sachs, senior vice president at Atlanta-based Hobbs Group LLC. "I think it will be a kick to the economy that will have some significance."

The Sept. 11 terrorist attacks boosted insurance prices by as much as 500 percent. The Louis Armstrong New Orleans International Airport said it has been quoted a $1.4 million premium — five times what it paid last year — for half the war and terrorism coverage it had prior to the attacks.

Sachs said his company faces "significant" premium increases if there is no legislation soon. He said he may buy limited coverage from American International Group Inc., shop for coverage at Lloyd's of London or pursue a form of self-insurance.

To fix the problem, Congress and the White House are proposing that the government share future terrorism losses. The Senate bill would have the government pay 90 percent of claims after the first $10 billion in terrorism-related damage. The House passed a bill Nov. 29 to provide government loans to insurers when terrorism losses exceed $1 billion.

The real estate industry may be hit the hardest. Lack of terrorism insurance, besides scaring away lenders, may lead to defaults in the mortgage-backed securities market. Bondholders require terrorism insurance for such investments and could declare mortgage-backed bonds in technical default without the insurance, Michael J. Alter, president of The Alter Group, an Illinois-based real estate development firm, said.

"It will be chaos," said Alter, whose company holds about 7 million square feet of office property in 15 cities. "The absence of this legislation getting passed is potentially devastating to our industry."

Obie O'Bannon, vice president of government affairs at the Association of American Railroads, said rail carriers face unusual terrorism exposure since they're obligated under "common carrier" laws to ship hazardous materials.

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Railroads will have to decide "at the highest level of railroad management" whether they will carry hazardous materials without terrorism insurance coverage, O'Bannon said.

"In some cases, it's a bet-the-company scenario," O'Bannon said. The other option, refusing traffic, would violate a railroad's common carrier responsibility. "Undoubtedly it will lead to litigation," he said.

John Bromley, spokesman for Union Pacific Corp., declined to discuss options for his company without terrorism insurance. The market impact on the company has been tangible, he added.

"We've been notified by our insurer that coverage of terrorist acts will be eliminated or drastically reduced," he said. Premiums of remaining coverage go up by as much as 100 percent, he said.

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