The airline disasters in New York City, Pittsburgh and Washington, D.C. have taken an incalculable toll of human lives. The National Association of Independent Insurers (NAII) has three member companies headquartered in the World Trade Center. The Association extends its deepest condolences to the families of those employees and to the tens of thousands of individuals across the United States who lost friends and relatives as a result of this deeply disturbing act of terrorism.
The tragedy of this terrorist act will also send shock waves through the global insurance industry as losses from the incident will exceed $25 million and be declared an official catastrophe.
The insurance ramifications of the disaster include:
· Property and liability losses sustained by the insurers and reinsurers of the airlines
· Property and liability losses sustained by the insurers and reinsurers of the World Trade Center and other surrounding buildings
· Workers’ compensation coverage for injuries sustained by workers in the World Trade Center, the Pentagon and other surrounding buildings
· Auto insurance losses for cars damaged by falling debris and those destroyed in underground parking garages
· Business interruption losses sustained by the insurers of the businesses in the World Trade Center and surrounding buildings
· Property losses for computers, furniture and other contents sustained by the insurers of the businesses in the World Trade Center and surrounding buildings · Contingent business interruption insurance for the general “interruption of commerce” these acts caused other businesses
· Potential liability exposure for the insurers of the World Trade Center and surrounding buildings for not promptly evacuating all employees
The NAII is currently working with loss and claims professionals among its member companies and others in the insurance and reinsurance industries to develop an accurate assessment of the insured losses from this tragedy. However, because of the nature of this terrorist act, it is likely that law enforcement officials will conduct an extensive investigation and will limit the access of insurers to thoroughly assess the damage. As such, it may take weeks before a definitive financial analysis is available. Finally, NAII is analyzing the impact this catastrophe may have on insurance availability and affordability for large commercial risks.
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