The Professional Insurance Agents of New York State Inc. (PIANY) President David Isenberg testified before the New York State Assembly Insurance Committee that independent insurance agents face increasing difficulties placing comprehensive coverages for clients in the state.
Isenberg was asked to provide testimony to the committee about the availability and affordability of coverage and the impact on the New York City region’s recovery in the wake of Sept. 11.
Agents and brokers are using innovative methods for their clients to put together adequate coverage, but despite producers’ unprecedented efforts to structure policies to meet needs, insureds are facing tough decisions, including sacrificing coverage and accepting never-before-seen increases in deductibles. PIANY members are seeking out alternative sources and specialty markets—and even with the extraordinary effort, can not in some cases, secure adequate coverage at affordable prices.
Isenberg cited examples reported by PIANY members of extraordinary efforts to obtain coverage in the New York City area. One such example was a real estate company with property in Brooklyn and the Bronx, which obtained insurance with a 200 percent increase in deductible, a terrorist exclusion and a layered program among multiple insurers, with only the first
$1 million in the admitted market. “Perhaps you can infer, behind this brief sketch, the amount and quality of work done on the part of the producer seeking (and competing) to structure this coverage, yielding an acceptable, if not an ideal, outcome,” Isenberg told the committee.
Despite these challenges, Isenberg noted PIA’s market survey did not find New York City producers perceive the insurance market as more difficult than their counterparts in upstate New York or in other nearby states. “I would caution against drawing the conclusion that, except for the issue of terrorism exclusions, the New York City area is necessarily being singled out for much stricter underwriting by the insurance industry as a whole during this difficult market.”
Isenberg observed that the contributions and expertise of the independent agents has been instrumental in maintaining coverage for their customers in the metro area and throughout the state. “Yes, the market is difficult,” he said. “But the insurance producer community is rising to the challenge; and in many cases agents and brokers have succeeded in putting together coverage in the face of unprecedented obstacles … So, as the committee evaluates the efforts of the industry to come to grips with a global crisis in insurance availability, I hope it will remember the special role of the local independent agent and broker, scouring the market for the best available insurance programs in a vastly different environment.”
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