Although the damage caused by Hurricanes Katrina and Rita could effectively negate the record profits enjoyed by the insurance industry during the first half of the year, companies should not expect a reactionary hardening of the market similar to the months after the Sept. 11, 2001 terrorist attacks.
"The hurricanes will have a very, very substantial impact," said Robert Hartwig, senior vice president and chief economist at the Insurance Information Institute. "The only question is how much, ultimately."
Taken together, Mr. Hartwig said, the losses from Hurricanes Katrina and Rita "are basically equivalent to every dime of profit the insurance industry hoped to earn," during the first half of the year.
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