S&P: Federal Backstop Could Degrade Ratings
NU Online News Service, Oct. 22, 4:26 p.m. EST?Passage of a bill providing federal backing for terrorism insurance could lead carriers to discard good underwriting principles in a chase after premium dollars, a Standard & Poor's study warns.
"This business has always been subject to strong competition, and the attractiveness of cash flow is never too far from the minds of investors. Our concern is that insurers will let down the guard they appropriately put up after 9/11," commented Steven J. Dreyer, managing director of New York-based S&P insurance ratings.
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