Running sneakers hang as memorial about two weeks after the Boston Marathon bombings on April 15. (Photo by Chad Hemenway)

Two explosions rang out near the finish line of the Boston Marathon on April 15, and while the event did not result in a huge payout for property and casualty insurers, it did have some measure of impact on the industry.

The explosions left three dead and hundreds injured, and also damaged property in the vicinity.

As of September, the Massachusetts Division of Insurance says insurers paid about $1.18 million in claims in Boston as well as surrounding communities such as Watertown, Mass. and Cambridge, Mass. Business interruption claims were the most common type of loss.

This story makes the top-10 based more on its overall newsworthiness rather than a direct impact on the P&C industry, but the event could factor into the debate over an extension of the Terrorism Risk Insurance Act. Insurance associations were rightfully reluctant to draw any connection immediately after the bombings, insisting that the focus then should remain on assistance and recovery. But some did note that when the TRIA debate resumed, it would do so with this event serving as a reminder of the threat the country faces.

9: A Tragedy That Led a Chairman to Resign

Josef Ackermann, shown in this AP file photo as CEO of Deutsche Bank, resigned Aug. 29 over the apparent suicide of Zurich's CFO.

In August, Josef Ackermann resigned as chairman of Zurich Insurance after the suicide of the company's Chief Financial Officer Pierre Wauthier.

Reuters reported Ackermann's statement: “I have reasons to believe that the family is of the opinion that I should take my share of responsibility, as unfounded as any allegations might be. As a consequence, I see the possibility of a continued successful board leadership to the benefit of Zurich called into question.”

Wauthier described himself in a note as demoralized after months of a new, more aggressive tone at Zurich under Ackermann, Reuters reported, citing “several people who have seen the letter.”

A Zurich review released in November cleared Ackermann of any blame in the suicide.

Earlier this month, George Quinn announced he was leaving Swiss Re to assume the CFO position at Zurich.

8: Obamacare Implementation

President Barack Obama speaks during an election night party in Chicago. (AP Photo/Matt Rourke)

While the shaky Obamacare rollout has been a bigger story on PC360's sister site, LifeHealthPro, the issues arising from the law and its implementation have spilled over to areas of the P&C marketplace.

Arthur J. Gallagher CEO Patrick J. Gallagher continues to state that the law is creating demands for services from big brokers such as AJG that are able to handle the increased compliance requirements, at the expense of smaller independent agencies that find themselves unable to keep up.

National Underwriter Executive Managing Editor Laura Toops listed Obamacare in her roundup of the biggest challenges and opportunities for independent agents in 2014, noting that while the new law is tough to navigate, agents can still take a leading role in educating clients about their options.

From an insurance technology standpoint, Jerry Poole, president of Acrometis, writes that the troubled launch of HealthCare.gov could serve as a lesson for P&C insurers launching their own tech services, highlighting the importance of trial and error over high-profile launch schedules.

Sam Friedman, research team leader at the Deloitte Center for Financial Services, makes a similar case regarding lessons for commercial insurers looking to launch platforms to sell insurance directly to consumers.

As for the P&C marketplace, Marsh reported earlier this month that directors and officers liability rates for healthcare organizations climbed in the third quarter due in part to antitrust concerns arising from the industry's changing business models pursued in response to the healthcare law.

7: Cyber Security — Increasing Threats and Increasing Interest

Throughout the year, articles about cyber security and coverage were of increasing interest to PC360's readers.

By the end of the year, a major breach at retailer Target showed why the topic has been building in interest.

A Lloyd's of London survey of 600 C-Suite and board-level executives in August listed cyber threats among the top-three risks corporations face.

A Towers Watson survey of global insurance executives in November listed cyber warfare as number four in its “Top-10 Most Extreme Risks.”

In October, speaking at the Property Casualty Insurers Association of America's Annual Meeting, former Secretary of Homeland Security Michael Chertoff said cyber security is the most significant threat we face.

The issue of cyber risk, he said, “affects virtually every kind of enterprise,” with motivations ranging from terror plots to “hackivists,” to a disgruntled employee or customer or even accidental leaks.

6: Solid Performance for the Industry

Insurance Information Institute President Robert Hartwig says the P&C industry appears on track for its best year in the post-crisis era thanks to lower catastrophe losses and higher premiums.

Through the first nine months of the year, according to data released by ISO and the Property Casualty Insurers Association of America (PCI), net income after taxes rose to $43 billion for the industry, compared to $27.8 billion in the same period of 2012. The fourth quarter is also expected to be more profitable than 2012's.

The industry's combined ratio improved to 95.8 for the first nine-months of 2013 from 100.7 for nine-months 2012.

The solid performance has led various ratings agencies to declare a stable outlook for the P&C industry heading into 2014.

However, the results have also led to questions about how long the environment of steady rate increases can last.

5: Legends Pass On

Jack Byrne (top) and Peter Lewis (bottom)

In 2012, NU released its “Top 25 Living Legends of Insurance.”

This year saw two of those legends, Jack Byrne and Peter Lewis, pass on.

Byrne died at his home in Etna, N.H. on March 7 after a long battle with cancer. He was 80 years old.

Byrne was listed at number 8 in NU's Living Legends feature. His career accomplishments include leading impressive turnarounds at GEICO and Fireman's Fund.

Lewis died of a heart attack at his home in Coconut Grove, Fla., also at the age of 80.

He was listed at number 2 in NU's Living Legends feature, credited with being behind many important innovations at Progressive Insurance.

4: The Hurricane Season That Wasn't

There are many sayings about the difficulty in predicting the weather, and forecasters received a harsh lesson in that area during this year's hurricane season.

The average for the Atlantic hurricane season from June to November is 12 named storms, six hurricanes and three major hurricanes. Most forecasters predicted an above-average season for 2013.

NOAA's Climate Prediction Center in May called for 13-20 named storms with 7-11 hurricanes and 3-6 major hurricanes. Colorado State University (CSU) called for 18 named storms, nine hurricane and four major hurricanes. The Weather Channel's Weather Services International called for 16 named storms, nine hurricanes and five major hurricanes.

The final results when hurricane season ended? Thirteen named storms, two hurricanes and no major hurricanes, or as CSU researcher Phil Klotzbach says, “…one of the largest busts for our research team in the 30 years we've been issuing this report.”

Instead of making headlines for being an above-average season, 2013 instead will go down as the “quietest U.S. Atlantic hurricane season in decades,” according to Fitch Ratings, and a season with the fewest named hurricanes since 1982. The quiet season is expected to cause a drop in reinsurance rates at Jan. 1 renewals.

However, the quiet season should not fool insurers. As Fitch says, the “modest respite…does not diminish perspectives on the potential risks of natural disasters as population and property exposures in coastal areas and earthquake prone regions continue to expand.”

3: West Fertilizer Explosion

On April 17, tens of thousands of pounds of ammonium nitrate exploded at the West Fertilizer Co. in West, Texas, leveling nearby homes, killing 15 people and injuring hundreds more.

The story generated major interest among PC360's readers mostly due to the risk-management implications of storing so much ammonium nitrate so close to schools, apartment complexes and a nursing home as well as the small amount of liability insurance (and lack liability insurance requirements) held by the plant.

The West Fertilizer Co. carried just $1 million in liability insurance. Lawsuits filed in the wake of the explosion included legal action taken by some W.R. Berkley Corp. companies that insured nearby properties. Paul A. Grinke, the attorney for the group, told PC360, “Unfortunately I'm involved in a lot of cases dealing with underinsured properties, but I've never been involved in something like this—a facility such as this one with so little insurance for the risk.”

The Insurance Council of Texas puts insured property losses for the disaster at about $100 million, but that figure could increase. The total includes estimated insurance payments for the plant, 140 homes, an apartment complex, a middle school and a retirement center.

The Texas Department of Insurance says four state agencies with some oversight—the Department of State Health Services, the Office of the Texas State Chemist, Texas Commission on Environmental Quality and the Texas Department of Agriculture—do not require general liability coverage at an operation like West Fertilizer.

2: NFIP Uncertainty…Again

Like a horror movie villain that always seems to come back to life no matter what's thrown at it, uncertainty around the National Flood Insurance Program re-emerged this year even after a five-year extension of the program with reforms was passed in 2012.

The issue now? Fears among legislators, regulators and various groups that the law's mandated premium increases for some properties — designed to phase in actuarially sound rates and bring stability to the NFIP — are too steep and unfair to homeowners and businesses in the impacted areas.

This year saw statements and actions by legislators as well as legal action taken by states all in an effort to delay the rate hikes from taking place until an affordability study could be conducted.

PC360 Washington Bureau Chief Arthur D. Postal lists the ongoing uncertainty surrounding the NFIP in his top-5 industry Washington issues for 2014.

He notes that Congressional action, and in some cases inaction, throughout this year seemed to indicate a lack of appetite to pass a delay, but recent developtment will see the Senate take up legislation early next year.

The legal action taken by Mississippi and other states is expected to be decided shortly as well.

1: The Continuing Evolution of Federal Involvement in Regulation

In July, American International Group was officially labeled “systemically important,” paving the way for federal regulation of an insurer for the first time in 150 years.

At the end of the year, the Federal Insurance Office released its long-awaited report on regulatory modernization, calling for a hybrid state/federal approach to insurance regulation.

These actions, pursued in accordance with the Dodd-Frank Act, have reignited a longstanding federal vs. state regulation debate within the insurance industry.

Some in the industry saw the FIO's report as striking the right balance on the issue. Others responded to the report by ardently defending state-based regulation, and cautioned that the report could be a first step toward an increased federal presence.

Insurance Information Institute President Robert Hartwig says the first step has already been taken, as Dodd-Frank is the law of the land and “already codifies parts of the hybrid approach to regulation that the FIO report contemplates.”

PC360 Washington Bureau Chief Arthur D. Postal lists federal vs. state regulation in his top-5 industry Washington issues for 2014.