I have to hand it to the jury in this case. For a layperson to have to sit through weeks of conflicting testimony and be forced to read the techno-babble in all the insurance documents involved in the WTC coverage program had to be overwhelming. Indeed, early on in the trial, the poor jury passed a note to Judge Michael Mukasey asking, “What is this case about?”

My gut feeling about the case was that in the end the jury would throw up their hands in frustration and say, essentially, “The hell with it! We can't make heads or tails of this nonsense. Mr. Silverstein needs the money to rebuild, the city needs the site rebuilt, the insurers were as clueless as the broker and the WTC's risk manager as to what forms and definitions appliedJust give them the extra money already!”

But the jury did its duty, looking strictly at the “facts” (as convoluted as they were) and setting aside any sympathy they might have felt for the plaintiff or the city.

No one came out of this trial looking good. Mr. Silverstein's risk manager, Robert Strachan, appeared confused about his own insurance program. The brokers on the placement could not seem to get their stories straight.

As for the underwriters, good grief! Even though the verdict basically came out in the industry's favor, most of the insurers on this exposure did not appear to have a firm grasp of the coverage details. Indeed, the program was still a work in progress on 9/11?well after the coverage was bound. That fact alone might have swayed the jury the other way. If the insurers did not know for sure how the coverage was written, who did?

The trial exposed one of the industry's biggest shortcomings its inability to deliver policies in a timely fashion, error-free. In our “State of the Market” survey (covered at length starting on page 12), more buyers and brokers feel their carriers are getting the job done in this regard, but the large majority still complain they are being left hanging.

Buyers deserve better service than this. Perhaps the jurors in phase two will take that into account and order the insurers involved to pay double. But no matter how this case turns out, the lesson for all parties involved is to clean up your act!

Sam Friedman

Editor-In-Chief

Reproduced from National Underwriter Edition, May 21, 2004. Copyright 2004 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.