In a recent White House meeting, Independent Insurance Agents of America (IIAA) CEO Robert A. Rusbuldt and other industry leaders reassured President Bush that insurance agents and companies are well-positioned to handle and pay claims stemming from the Sept. 11 terrorist attacks.
President Bush convened the meeting with insurance executives to learn firsthand about the state of the industry following last week’s tragedies and how the industry is responding to the overwhelming number and size of claims that are expected, especially from the collapse of the World Trade Center towers in New York City.
“We applaud President Bush for his leadership and for shining a spotlight on the insurance industry and its strong commitment to fulfilling its responsibilities,” said Rusbuldt.
Rusbuldt was asked by senior White House officials to attend the meeting to relay the perspective of independent insurance agents and brokers. Participants in the meeting included Rusbuldt; the chief executives of The Hartford, Chubb Insurance Companies, AIG, Travelers, General Re, St. Paul, Kemper and several other companies directly affected by the tragedy; and the heads of two insurance company trade associations based in the nation’s capital.
The primary focus was on the financial stability of the industry and whether it has ample reserves to pay an estimated $20 billion to $40 billion in losses caused by the terrorist attacks.
Individually, and as a group, myself and the other company and trade association executives sought to put President Bush and other administration leaders at ease about the financial health of the overall insurance industry and individual primary and U.S. reinsurance companies,” noted Rusbuldt following the 45-minute meeting. “We reassured the President that the industry is well-capitalized with over $3 trillion in assets that will be called on to pay claims. We also told the President that insurance agents and companies are already on the ground in affected areas of New York City paying claims caused by the disaster.”
Rusbuldt also said that the group discussed with President Bush the issue of whether primary insurance and reinsurance companies would invoke the so-called “acts of war” exclusion, and the possibility of a partnership with the federal government on coverage of future terrorist acts.
“There was unanimity among the insurance executives that invoking ‘war’ exclusions was not an option,” said Rusbuldt. “The group pledged to the President that the insurance industry would fulfill its obligations to the American public and business owners. We told President Bush that the industry is dedicated to helping Americans who were directly affected by the tragedy to rebuild their lives and their businesses and that we will be there to help throughout the national recovery.”
Commenting on the White House meeting, Rusbuldt said it was productive because it allowed the industry executives to discuss a wide range of issues related to the tragedy and to communicate confidence in the insurance industry’s financial health and its response to the needs of individuals and businesses.
“The President was appreciative of the industry’s united position on its strong financial condition and its commitment to serving victims and survivors in their greatest hour of need,” said Rusbuldt. “President Bush implored the assembled executives to help victims recover so they can put their lives back together.
“For independent agents and brokers, the presidential meeting allowed me to convey how seriously IIAA members take the commitment they’ve made to their clients,” said Rusbuldt. “I assured President Bush that agents and brokers will stand shoulder-to-shoulder with their clients until their claim is fully resolved. That is the job of agents and brokers, and they stand ready to offer their assistance to aiding the recovery process.”
Rusbuldt said the President discussed a wide range of topics including the economy, airline industry and, of course, terrorism. “The President made it clear that America is at war, that a free society is difficult to defend, and that he was giving world leaders specific actions he wants them to take in the war on terrorism,” relayed Rusbuldt. Rusbuldt told the President privately that IIAA is strongly supporting him, that we are praying for him and that he is the right person at the right time to be leading the nation through this crisis.
In addition American Insurance Association (AIA) president Robert E. Vagley announced that several members of the AIA board had also met with President Bush.
“We will meet our obligations to our policyholders,” Vagley said on behalf of the assembled insurance executives. Vagley went on to assure the President that the property-casualty insurance industry is “prudently managed. We believe that we can appropriately deal with the losses from the September 11 terrorist attacks, and still stand strong.”
Vagley praised the President for calling the industry leaders together, saying “we greatly appreciate the opportunity to meet with the President, particularly at this critical time.”
Vagley said that the company executives told the President that “we are actively settling claims, and will do everything we can to help the thousands of individuals, families, and businesses who were victims of these attacks move forward.” The industry representatives also noted that insurers are in the business of responding to loss – even horrific loss, such as that of September 11. “This is what we do,” said Vagley.
Company executives described for the President how the industry has been responding since September 11, noting that the insurers’ immediate focus has been on the people who were injured or killed in this tragic event. Insurers were deeply affected by the attacks – not only because they are being called upon by so many policyholders, but because so many respected insurance industry colleagues in the World Trade Center were lost.
Insurers have deployed special catastrophe response teams to New York, established special claims centers, and widely publicized “800” numbers and other key company contact information in order to expedite the claims handling process. All of this is being closely coordinated with the NY Insurance Department and other regulators. The industry also has an ongoing, open dialogue with Congressional leadership, and key Bush Administration officials to ensure that they have the most up-to-date information on the industry’s efforts.
Turning to the future, Vagley said that insurers are keenly interested in public policy discussions about potential mechanisms to deal with additional terrorist attacks, war-related damages, or other mega-catastrophes.
In conclusion, Vagley stated that the assembled insurance executives “are very proud to be a key part of the nation’s response and recovery system,” and restated the industry’s “willingness to step up and play our proper role in the economic recovery of this great nation.”
AIA member company executives attending the meeting were Ramani Ayer, chairman and CEO of The Hartford Financial Services Group; Brian Duperreault, chairman and CEO of ACE Limited; Jay Fishman, chairman and CEO of Travelers Property Casualty Corp.; Bernard L. Hengesbaugh, chairman and CEO of CNA Insurance Companies; Constantine “Dinos” Iordanou, senior executive vice president of Zurich Financial Services Group; Douglas W. Leatherdale, chairman and CEO of The St. Paul Companies; David B. Mathis, chairman and CEO of Kemper Insurance Companies; and, Dean R. O’Hare, chairman and CEO of The Chubb Corporation.
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