Standard & Poor’s said the Y2K bug that was predicted to cause problems with computer systems worldwide on Jan. 1, 2000, led to no widespread damage for the insurance industry.
It also said there were some isolated incidents and that it is too early for insurers to declare total victory over the Y2K bug.
Cost of Y2K remediation is estimated at about $200 billion, about half of which relates to the U.S., if insureds are successful in recovering even a portion of these costs. S&P said losses could develop into a meaningful issue for the industry.
S&P has not made any insurance ratings changes related to Y2K. Overall, it said insurance companies have reported a nominal amount of claim and notification activity. Sue and labor claims, in which insureds are seeking to recover costs associated with fixing date-sensitive systems, seem to be the only real area of concern.
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