Brokers/Agents must unite nationally and get the blowhards in Washington to understand what is at stake if they don’t renew TRIA. The lawmakers in Washington don’t know the first thing about insurance and so they must be educated. (If they were aware of the insurance game-they would change the rules). All you brokers/agents making the broohah about not wanting to tell your clients how much commission you make, must get together and write your legislators and tell them what you think about renewing TRIA. Get to your State’s insurance departments and tell them what you think. Those pompous, slick haired millionaire senators have to be told what to do. There are a few that are OK and want to do the right thing, but most are blowhards that talk only to make themselves be heard and seen by their constituants.
Maybe we need Hank G., not the baseball player, to tell them what HE wants and it will get done.
First off, what is at stake? With the exception of certain large cities, many do not see the need to even purchase the coverage on their policies. Free markets will adjust to certain situations, eg. state or local risk pools will develop, or specialty markets will arise to provide coverage like EQ, Wind and Flood. Hank G doesn’t really want a government back stop – he criticized the gov’t for providing aviation insurance after 9/11 when his company was trying to make a fortune raising its prices to the aviation industry. Warren Buffet thought that the government should have helped to create a insurance facility for terrorism like the banking industry’s FDIC where carriers buy in and pay for terrorism reinsurance. Was that even considered? What the international markets that have been dealing with terrorism far longer than we have here in the states – England and Europe have a pool where carriers buy and share their aggregated risk for a premium?
If we can find markets willing to provide insurance against acts of nature which can be devastating to the tune of billions – quake and wind – then there can be a private pool developed for this as well. If you don’t think so then we as a country and a society have a much greater problem. Are we living in under a very false sense of security and safety in this country.
I agree- however, its the large cities and the insurance market in them that will shrink some more.
Insureds located away from large city downtown target areas aren’t buying terrorism and that’s OK. However, if the companies were smart they would price the coverage so reasonably that everyone, including insureds in the suburbs, would buy it and in conform with the old insurance axiom,”spread the risk.”
I dont see what the big deal is – Its not like they have had to pay any claims. There have only been 3 incidents of terrorism in the US in the last 100 years, and one of them was domestic. If there were really any terrorists they would have struck by now.
That sounds so simple and almost utopian – I’m sure so many businesses purchase flood and quake insurance in non hazardous flood and quake areas now? How many businesses buy quake that happen to be located outside of CA, Pacific Northwest or the New Madrid quake zone?
Why must Terrorism be insurable in the first place? Why expect there to be insurance for risks like terrorism when we can’t even find the persons responsible for contaminating the Federal Senate Office buildings in DC post 9/11 that cost tens of millions of dollars to decontaminate! War isn’t insurable – why should the war on terrorism be when we are not even able to bring to justice those responsible for such acts? Just because quake and flood coverage is available not everyone purchases it and carriers aren’t forced to offer it – even in hazardous areas where the insureds have the most probability of suffering a loss. Why must the peril of Terrorism be covered? So large banks and financial institutions and real estate owners in target areas can protect their investments and pass off their risk/liability to an insurance company or the entire public through the government? Why ask many others to subsidize the costs or risks that only a few really have? There is a better way than TRIA and the insurance industry’s lack of willingness to come up with one over the past two years is ridiculous.
The fact is that TRIA protects weak insurance companies and penalizes the financially soundest – and falsely provides a sense of security to the public buying insurance from failing insurers trying to grab premiums in all markets to prop up their poor loss results. If TRIA didn’t exist only the financially soundest carriers with the most prudent underwriting standards would be in position to provide terrorism coverage. Now you have small insurers offering coverage in target areas recklessly because the government will provide coverage over their obligations BUT I wounder whether they would even be able to meet their TRIA deductible and coverage assumption if something should occur? By imposing deductibles and coverage requirements that factor in all premiums earned in non-target markets now TRIA forces larger carriers to consider the increased writings in non-target areas in their assessment of the total amount of risk they can assume in target areas. How do these carriers fund for this increased exposure when only those in target areas will purchase the coverage? Whether the premium is “reasonable” as you say – I don’t believe people everywhere will pay for it. Otherwise wouldn’t there have been some sort of federal insurance policy TRIA surcharge enacted – like the state insurance taxes/surcharges that exist on policies today for other reasons? Also the current coverage grant by TRIA forces insurers to consider passing the cost across their entire volume of commercial accounts – but does not provide for them to do so on a mandatory basis – then carriers individually must do so on a mandatory basis but face the risk of losing accounts to competitors. Competing carriers who will allow insureds the ability to opt out in non-target areas as they don’t have an aggregation in target areas to fund for puts mnay insurers at a disadvantage. So if insureds can save 4% or 5% by declining the coverage many will most definitely do so. TRIA is far from perfect.
The government needs to set up its own reinsurance facility or insurance “FDIC” or help create a risk pool for insurers to jointly buy in like in England and Europe. Otherwise they should stay out of it and allow the market to set up it own solution if there is one.
Brokers/Agents must unite nationally and get the blowhards in Washington to understand what is at stake if they don’t renew TRIA. The lawmakers in Washington don’t know the first thing about insurance and so they must be educated. (If they were aware of the insurance game-they would change the rules). All you brokers/agents making the broohah about not wanting to tell your clients how much commission you make, must get together and write your legislators and tell them what you think about renewing TRIA. Get to your State’s insurance departments and tell them what you think. Those pompous, slick haired millionaire senators have to be told what to do. There are a few that are OK and want to do the right thing, but most are blowhards that talk only to make themselves be heard and seen by their constituants.
Maybe we need Hank G., not the baseball player, to tell them what HE wants and it will get done.
First off, what is at stake? With the exception of certain large cities, many do not see the need to even purchase the coverage on their policies. Free markets will adjust to certain situations, eg. state or local risk pools will develop, or specialty markets will arise to provide coverage like EQ, Wind and Flood. Hank G doesn’t really want a government back stop – he criticized the gov’t for providing aviation insurance after 9/11 when his company was trying to make a fortune raising its prices to the aviation industry. Warren Buffet thought that the government should have helped to create a insurance facility for terrorism like the banking industry’s FDIC where carriers buy in and pay for terrorism reinsurance. Was that even considered? What the international markets that have been dealing with terrorism far longer than we have here in the states – England and Europe have a pool where carriers buy and share their aggregated risk for a premium?
If we can find markets willing to provide insurance against acts of nature which can be devastating to the tune of billions – quake and wind – then there can be a private pool developed for this as well. If you don’t think so then we as a country and a society have a much greater problem. Are we living in under a very false sense of security and safety in this country.
I agree- however, its the large cities and the insurance market in them that will shrink some more.
Insureds located away from large city downtown target areas aren’t buying terrorism and that’s OK. However, if the companies were smart they would price the coverage so reasonably that everyone, including insureds in the suburbs, would buy it and in conform with the old insurance axiom,”spread the risk.”
I dont see what the big deal is – Its not like they have had to pay any claims. There have only been 3 incidents of terrorism in the US in the last 100 years, and one of them was domestic. If there were really any terrorists they would have struck by now.
That sounds so simple and almost utopian – I’m sure so many businesses purchase flood and quake insurance in non hazardous flood and quake areas now? How many businesses buy quake that happen to be located outside of CA, Pacific Northwest or the New Madrid quake zone?
Why must Terrorism be insurable in the first place? Why expect there to be insurance for risks like terrorism when we can’t even find the persons responsible for contaminating the Federal Senate Office buildings in DC post 9/11 that cost tens of millions of dollars to decontaminate! War isn’t insurable – why should the war on terrorism be when we are not even able to bring to justice those responsible for such acts? Just because quake and flood coverage is available not everyone purchases it and carriers aren’t forced to offer it – even in hazardous areas where the insureds have the most probability of suffering a loss. Why must the peril of Terrorism be covered? So large banks and financial institutions and real estate owners in target areas can protect their investments and pass off their risk/liability to an insurance company or the entire public through the government? Why ask many others to subsidize the costs or risks that only a few really have? There is a better way than TRIA and the insurance industry’s lack of willingness to come up with one over the past two years is ridiculous.
The fact is that TRIA protects weak insurance companies and penalizes the financially soundest – and falsely provides a sense of security to the public buying insurance from failing insurers trying to grab premiums in all markets to prop up their poor loss results. If TRIA didn’t exist only the financially soundest carriers with the most prudent underwriting standards would be in position to provide terrorism coverage. Now you have small insurers offering coverage in target areas recklessly because the government will provide coverage over their obligations BUT I wounder whether they would even be able to meet their TRIA deductible and coverage assumption if something should occur? By imposing deductibles and coverage requirements that factor in all premiums earned in non-target markets now TRIA forces larger carriers to consider the increased writings in non-target areas in their assessment of the total amount of risk they can assume in target areas. How do these carriers fund for this increased exposure when only those in target areas will purchase the coverage? Whether the premium is “reasonable” as you say – I don’t believe people everywhere will pay for it. Otherwise wouldn’t there have been some sort of federal insurance policy TRIA surcharge enacted – like the state insurance taxes/surcharges that exist on policies today for other reasons? Also the current coverage grant by TRIA forces insurers to consider passing the cost across their entire volume of commercial accounts – but does not provide for them to do so on a mandatory basis – then carriers individually must do so on a mandatory basis but face the risk of losing accounts to competitors. Competing carriers who will allow insureds the ability to opt out in non-target areas as they don’t have an aggregation in target areas to fund for puts mnay insurers at a disadvantage. So if insureds can save 4% or 5% by declining the coverage many will most definitely do so. TRIA is far from perfect.
The government needs to set up its own reinsurance facility or insurance “FDIC” or help create a risk pool for insurers to jointly buy in like in England and Europe. Otherwise they should stay out of it and allow the market to set up it own solution if there is one.