Perspective

Rolling NBCR

“Rolling NBCR [nuclear-biological-chemical-radioactive coverage] into terrorism coverage will likely result in significantly increased premiums and would likely have the unintended consequence of reducing the take-up rate for terrorism insurance. Requiring any retention of NBCR risk by primary insurers (even where the federal program bears most of the risk) makes little sense if insurers cannot find private reinsurance and if we are unable to resolve a set of very serious operational concerns and issues.”

– Warren Heck, chairman and CEO of Greater New York Mutual Insurance Co., testifying on behalf of the National Association of Mutual Insurance Companies and the Property Casualty Insurers Association of America.

Different this time

“Unlike other pricing cycles, which have been deep and long on the downside, we may experience something different this time around. Our reason for this cautious optimism is our overall view that as enterprise risk management is playing an increasing role at insurance and reinsurance companies, financial discipline will have a larger role this time.”

– Standard & Poor’s Managing Director Grace Osborne in May, 2007 discussing that the hard market, however short, is over.

ERM questions

“In three or four years I think many CEOs and CFOs of firms that have put a lot of executive time, effort, and money into enterprise risk management will be asking what they are getting in return. There are going to be some really hard questions asked.”

– Bill Panning, executive vice president, Willis Re, in July, 2007.