A View From The Press Box

It’s relatively easy to pick the top 10 stories of the year that just passed, as I did in my Dec. 24 blog entry, but predicting events that will rock the industry in the year ahead takes chutzpah! Click on to check out my picks, and feel free to weigh in, and offer some alternatives after peering into your own crystal ball.

What are the ethical implications of the controversial concurrent causation clause in property policies, which critics contend unfairly leaves those victimized by covered wind and uncovered flood losses potentially devoid of insurance, but which carriers say quite properly protects them against paying for uninsured damages? That's the question our ethics columnist, Peter R. Kensicki, put to NU's readers. Read on for highlights and insights on the passionate responses.

Those were huge wins yesterday in Iowa for Democrat Barack Obama and Republican Mike Huckabee! While this is really just the spring training of the political season, with much bigger races yet to come in South Carolina, Florida, New York, California and many other major states within the next 30 days, I think Iowa's results is an early indication that people are responding strongly to the positive message preached by the two victors--namely, that most people want an end to narrow, gridlock-inducing political partisanship. So, where do the candidates go from here?

Following the recent Southern California wildfires, a report in the Nov. 13 New York Times indicated that “as many as 40 percent of homeowners statewide lack enough insurance to cover their home replacement costs,” a problem that “most [policyholders] realize…only when it’s too late.” Ethically speaking, what should carriers and producers be doing, if anything, to make sure properties are properly insured? What responsibility do they have if it turns out that they are underinsured at the time of loss? For those who respond, you need not give your name, but for context, please let us know what role you play in the industry—insurer, agent, adjuster, risk manager?

Today's Wall Street Journal has a disturbing story about a church deemed too risky for property insurance because it supports gay rights. The reason cited by the carrier is that taking a controversial position backing same-sex marriage and ordination of homosexuals means there's a greater threat of property damage and litigation against the church. Is this sound underwriting or homophobia? I would guess the latter. How about you?

It turns out that reports of the political deaths of Sens. Hillary Clinton and John McCain were greatly exaggerated. Political pundits--myself included--were tempted to write off at least one of the candidates (Hillary) after her shockingly decisive defeat in Iowa, and of course McCain was labeled a has-been long before that. Now, it appears that the Iowa debacle might have been the best thing that could have happened for last night's comeback kids.

It was a rather glum group of CEOs that gathered in New York this week for the annual family reunion of top insurance company and association executives, as all the tea leaves seem to indicate insurers have about as much chance of improving the top- and bottom lines this year as Ron Paul has of becoming President of the United States.

The deadline for entries for National Underwriter's inaugural “Agency Technology Achievement Award,” launched in partnership with ACORD, has been extended to Feb. 25. In addition, the deadline for nominations from interested third parties—including insurance companies, managing general agencies, tech vendors and user groups—has been extended to Feb. 11. Read on for more information, but we look forward to hearing your agency tech success stories!

It was a short but informative visit last week paid to NU Editorial HQ here in Hoboken by Florida Insurance Commissioner Kevin McCarty, who laid out the reasons why his state is going its own way on reinsurance regulation, given its massive catastrophe exposure and the snail's pace of change at the national level.

The "Good Hands" people over at Allstate sure have a strong grip when it comes to holding onto documents demanded by the government. The carrier had its license suspended in Florida this week for failing to cough up everything the state wants in its probe of property insurance rate-setting. Meanwhile, it can't shake a fine of $25,000 a day for refusing to hand over an infamous consultant's report, supposedly on how to stall claims--"a kind of holy grail for plaintiff lawyers nationwide," notes the "Kansas City Star," whose readers rightfully hammered the insurer online.

Yesterday, I commented on the legal problems confronting Allstate in Missouri over its refusal to release a controversial consultants' report that some charge prompted the "good hands" people to flash their fists at claimants. Now the battle has spilled over into Florida, where Allstate has seen its authority to write new business suspended entirely in a confrontation over property insurance rates. The Florida commissioner is asking to see that same McKinsey report, which must contain some pretty damning evidence to be guarded so jealously by Allstate.

Here we go again! Heavyweights Bob Hunter, insurance director of the Consumer Federation of America, is trading blows with Bob Hartwig, president of the Insurance Information Institute, over whether the industry is “methodically overcharging consumers” and shortchanging policyholders on coverage and claims. Who will win the latest round in "The Battle Of The Bobs"??? (Both Bobs responded to my blog over the weekend. Read on!)

National Underwriter is seeking entries for its second annual “Award For Excellence In Workers’ Compensation Risk Management.” Read on for details on how risk managers can enter, as well as how insurers, brokers and other interested parties can nominate a worthy candidate.

Insurance panel discussions are usually fairly mundane and predictable affairs, but in what might be the first real burst of spontaneity in the history of such events, the members of one panel stood up to publicly challenge the assertions of those on a subsequent gathering, with regulators and insurers going at it during the recent Joint Industry Forum. It was one of the most honest and productive exchanges I have ever seen between the two sides. I just wish there were more like it.

In the ongoing struggle to come up with new products to cover catastrophe losses, there is one new twist worth watching--a derivative product that is triggered not by actual losses, but by a force of nature, regardless of the subsequent damage claims. Read on for details and let me know what you make of this initiative?

It's not every day you get told off by an ex-FEMA director as well as a retired admiral and former deputy secretary of homeland security. But that's exactly what happened to me last week when I received a letter from James Lee Witt (pictured above) and James M. Loy, who now co-chair ProtectingAmerica.Org. The pair took issue with my recent recap of how well I had predicted the top stories of 2007, at least in terms of my take on the advance of their cause--to establish a national catastrophe fund. Read on for their critique and my response.

One of my loyal readers wrote recently to share an amusing (yet deadly serious) anecdote that shows how ingrained into the culture is society's suspicion of the insurance industry. Click ahead to read the tale, and see if that doesn't convince you of how poor the industry's reputation really is these days.

Sen. John McCain buried Rudy Giuliani’s presidential hopes in Florida last night, despite the winner’s adamant opposition and the loser’s vocal support on whether to establish a national catastrophe fund. What does the primary vote mean for cat fund backers? Vote Democratic!

It's hard to say which story was bigger news for me--that ace pitcher Johan Santana had been acquired by the New York Mets, or that Ace executive Brian Duperreault had been acquired by Marsh & McLennan Companies as its new president and CEO. Both moves will have a huge impact on their respective organizations.