Mississippi's casinos appear poised for a rebound, in partthanks to claims settlements paid the industry ruined by HurricaneKatrina, but one broker wonders if carriers will hedge their betsand hold back future coverage.

In a report issued by Standard & Poor's today, the NewYork-based rating service said the casino industry is poised for astrong comeback in Mississippi, with most of the state's casino'sreadying to reopen by the end of this year, and more gaminginterests looking to take root in the state.

The state's gaming industry was centered in Biloxi, with twocasinos in Gulfport and one in Bay St. Louis, employing 16,000workers. S&P said there are only three casinos in operationtoday, employing 4,600 people, but generating 55 percent ofrevenues the 12 did before Katrina. The industry generated $1.2billion in gaming revenue before the hurricane.

S&P said this figure gives the pre-existing casinos a strongincentive to get back into the game as soon as possible.

"We expected rated companies to invest significantly in thismarket in the next few years," said Peggy Hebard an associatedirector for S&P in a statement.

It also helps that the state changed the laws so the casinos,which were confined to barges anchored along the coast, are nowbuilt on land.

S&P noted that while many of the casino operators arenational corporations able to make the capital investments, theywill received help from insurance claims settlements. The reportnotes that the cost of insurance could be an issue for thesecompanies as they begin operations again.

Speaking to National Underwriter, Ms. Hebard and Mike Scerbo, adirector with S&P, said the larger operators should be able toabsorb the increased cost for insurance. The fact that threecasino's have opened, and others are planned to soon follow,including single property operators, demonstrates that insurance isavailable and not unaffordable.

Dana Berry, director of gaming and hospitality for Chicago-basedinsurance broker Aon, said that changes in the laws mean thecasinos, which were swept up by Katrina and destroyed, will now bebuilt to withstand hurricanes, making them a better insurance risk.However, "wind coverage is almost impossible to get," he said, andthose who do secure it find it "painfully expensive."

While there is no hard numbers available, he said the industryhas paid well over a billion dollars in claims to the casinos, withproperty and content losses settled, with business interruptionclaims left to be squared away.

"Business interruption claims usually take about a year tosettle, just in time for the next season," he noted with irony.

Casinos transfer risk to the traditional market, he explained,and despite the improved construction to the casinos, insurersremain reluctant about writing coastal risks, especially along theGulf coast. What the strategy will be for dealing with obtainingcoverage, as capacity appears to shrink, remains an ongoingquestion.

"The situation is not just about price, but just getting theinsurance," he said, adding the situation remains "fluid" withavailability changing week to week.

"This is what I lay awake at night's wondering about," hesaid.