Des Plaines, Ill. - Regulatory modernization, a long-term terrorism insurance solution and the Florida property market are top-of-mind issues the insurance industry will address in 2007, according to the Property Casualty Insurers Association of America (PCI).
The regulatory modernization topic continues to produce debates over terrorism and natural disaster issues in state legislatures and Congress. Des Plaines, Ill.-based PCI believes the inability of individual states and the NAIC to modernize the regulatory system on their own will continue to spur calls for federal intervention; yet a federal approach under a Democrat-controlled Congress may be more burdensome than the current state system.
Incoming Senate Banking Committee Chairman Christopher Dodd (D-Conn.) and incoming House Financial Services Committee Chairman Barney Frank have said establishing a long-term solution to the problem of insuring terrorism risks is among their highest priorities. PCI is working with members of Congress to ensure that the legislation is fair to all insurers and consumers and does not put the government in the position of picking winners and losers based on the type of weapon use in a future attack, the type of business that purchases terrorism coverage or the type of insurer that offers terrorism protection.
Florida state legislators will conduct a one-week special session on insurance issues beginning on January 16 and will reconvene for the regular session in March with the goal of stabilizing the Florida property insurance market. PCI is working with legislators to develop a comprehensive solution that can help attract more insurance capital to Florida and stimulate private market solutions to a seemingly intractable problem. PCI predicts the action taken by the Florida Legislature could have a dramatic impact on how other state legislatures and Congress deal with the growing problem of insuring catastrophic risks.
Source: Property Casualty Insurers Association of America
