“Without a federal backstop, availability of insurance will continue to suffer,” according to Robert Hartwig, chief economist and senior vice president of the New York-based Insurance Information Institute, one of nine p-c organizations co-sponsoring the forum. “It will also take longer for the industry to build the capital and confidence to underwrite this new risk, which will have an impact on the broader economy for at least the next year.”

An overwhelming number of respondents–ninety percent–are also convinced there is no chance that Congress will pass and President George W. Bush will sign legislation this year that “will help contain the current asbestos crisis.”

Respondents were similarly pessimistic about the chances for tort reform, with 72 percent saying that they do not expect any progress in this area this year.

However, a little more than half–54 percent–said they expect some progress in the fight against insurance fraud this year.

Meanwhile, 75 percent said they expect the pace of convergence in financial services to slow down in 2002.

The survey also showed that insurance industry leaders are very bullish about the prospects for higher rates and improved profitability in the year ahead, although analysts here warned that a rapid influx of capital could quickly short-circuit the hardening market–that is, unless a catastrophe hits, especially another terrorist attack. (See story, bottom of page 5.)

Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, January 21, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.

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