It’s mid-July and Chicagoans are finally getting a taste of actual summer-like weather, with sunny skies, light breezes and temperatures in the mid-80s. But conditions in the insurance industry are not as gentle as the waves of Lake Michigan which roll softly onto the shores of the local beach. It seems everybody’s got the summertime blues.
Last week especially delivered some rough news on the tort reform front. First John Kerry, the presumptive Democratic presidential nominee, chose as his running mate North Carolina Sen. John Edwards, who won his fortune as a personal-injury lawyer. While Edwards has come out in favor of reducing “frivolous lawsuits,” his definition of the term is much smaller than what most insurer lobbyists have in mind, for sure. Already, the traditionally neutral U.S. Chamber of Commerce has announced that it will work hard to defeat the Kerry-Edwards ticket, though they and other business groups will have to compete with the flood of trial-lawyer money likely to roll into Democratic coffers in even greater numbers than ever before.
As if that wasn’t enough, the latest U.S. Senate attempt to pass a bill moving certain class-action litigation to federal courts out of so-called “judicial hellholes” once again failed. The vote to invoke cloture and actually consider a vote on the bill failed miserably, 16 votes shy of the 60 necessary. As if the small lead the Kerry-Edwards ticket has built up is not enough to worry the industry, the chances for even retaining the Senate in Republican hands are slimmer after the Jack Ryan debacle in Illinois.
Of course, that’s not all. As our cover story by Stephanie Jones explains (page N4), rulings around the country on construction defects are making it much more difficult for residential contractors to find coverage. Many standard-market insurers are increasingly hesitant to put risks with an unknown claims horizon on the books, and that has made life tougher for these contractors and their agents.
In this issue you’ll also find a profile of MI-Assistant, an Eleva, Wis.-based agency solutions provider that is looking to expand its presence in the Midwest’s competitive rater market (page 39) against the tide of raters from national companies and in the new context of point-of-sale underwriting tools such as credit-based insurance scoring and loss-history databases.
Lastly, our Parting Shots this time out is authored by Larry Case, the executive director of the Missouri Association of Insurance Agents (page 42). He argues that companies and trade associations can do much better by agents. He is also kind enough not to lord over this Cubs fan the St. Louis Cardinals’ apparently insurmountable 7-game Central Division lead at the All-Star Break. Just one more reason to have the summertime blues.
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