Early on, key leaders such as Sen. Chris Dodd, D-Conn., and Rep. Barney Frank, D-Mass., have indicated that TRIA extension--perhaps on a permanent basis--will be put on a fast track.

Once approved by Congress, its unlikely President George W. Bushwhose administration has been lukewarm at best towards TRIA, believing such risks belong in the private marketwould veto any bill designed to protect the nation from a terrorist attack.

Meanwhile, Rep. Frank said finding a long-term solution to catastrophe insurance threats is also a priority, but laid out no clear path of action for Congress on that front--although he did throw out the idea of expanding TRIA to include natural disasters.

ProtectingAmerica.org, backed by Allstate Insurance, has been pushing hard for consideration of a national disaster fund of some sort to back up private carriers. But while the industry is united on the need for a terrorism facility, many powerful carriers and industry groups oppose federal meddling in the catastrophe market beyond shoring up the badly under-funded National Flood Insurance Program.

Its unclear how the new Congress will handle insurance regulatory initiativesincluding bills to standardize surplus lines and reinsurance oversight, and establish an optional federal charter system--but those who support more federal involvement are unlikely to be hurt by the change in power, as Democrats traditionally are more open to oversight from Washington. Challenges to the industrys federal antitrust exemption under the McCarran-Ferguson Act could accelerate the process.

However, the industry will find tougher sledding for any bill related to tort reform under the Democrats, who draw strong financial support from plaintiff attorneys specializing in class-action suits.

In local elections, the big newsthough expectedwas the elevation of the industrys chief nemesis of the past two years, New York Attorney General Eliot Spitzer, to the governors office.

After exposing bid-rigging, contingency fee deal manipulation and finite reinsurance abuse, Mr. Spitzers choice for superintendent of insurance will no doubt be far less conciliatory towards--and far more skeptical of--the industry than the states current regulator, Republican Howard Mills.

One cant help but wonder whether Gov. Spitzer will try to abolish all contingency fees in his statethe independent agency systems worst nightmare.

What do you think will happen?