I came awayfrom our annual P&C Executive Conference impressed by thefeistiness of many of the top players speaking, compared to lastyear's far more introspective and downbeat lot.

Part of that has to do with the times, of course. Last fall'sconference took place when the economy was collapsing, and theposter child for reckless investment decisions was AmericanInternational Group.

Even though AIG's p&c carriers were walled offfrom the financial guarantee woes forcing their corporate parent toaccept massive bailout funds from Uncle Sam, civilians–thosein the general public outside the insurance industry–heardthose three magic letters, and thanks to very effectivebranding, thought immediately of insurance.

That lingering misconception haunts the industry to thisday, as Congress keeps treating all financial servicesentities alike, even though it was banks and investment firms, notp&c insurers, that got us into this mess.

But last fall, with everyone licking their wounds and runningscared, most of the industry's leaders did not put up too much of afight. As usual during a crisis, most in the p&c sectorretreated into their shells, waiting for the furious publicand their panicked political representatives to stoppounding on their shells so they could crawl away once thecoast was clear.

But Mike McGavick, CEO of XL Capital, wasn't having any of thathumble pie as he led off this year's P&C ExecutiveConference–put together by The National Underwriter Company,working with sponsors Ernst & Young and Genpact.

Mr. McGavick said not only were p&c carriers not to blamefor the financial crisis, but that the sound way this industry wasregulated by the states should provide lessons to the federalgovernment as Congress struggles to get a grip on so-calledsystemic risks.

Mr. McGavick urged his fellow p&c insurer executives not to“hide behind your trade associations,” and step up to testifybefore Congress to tout the industry's soundness and the fineexample it set, while all other financial sectors were goingyou-know-where in a hand basket! (You can read the full story abouthis speech at http://bit.ly/3O95VR.)

Bob Hartwig, the Insurance Information Institute presidentand top-notch economist, warned carriers that ifthey were complacent about activities in Washington, not onlymight they be “swept in” to any new federal regulatory schemesdesigned to police much different breeds of cat in the financialsector, but that long-established tort reforms could be eroded aswell.

Last but not least, near the end of a one-on-one interview I didon stage, Chartis CFO Robert Schimek was also taking no guff when Iasked for his reaction to gripes from competitors that AIG'srebranded commercial insurers had underpriced them to try to makeup for reputational challenges following credit default swapwoes at AIG's Financial Products unit.

He pretty much told these critics to stuff it, insisting thatsuch charges were not only baseless, but were sour grapes bythose who had hoped and expected AIG's carriers to just fade intothe sunset. (You can read the full story about that interview athttp://bit.ly/YQod5.)

All in all, I felt a far more positive attitude at thisconference than last year's. Even a stubborn soft market, tankingeconomy and lousy investment environment does not seem to havedampened optimism about the future of this business. It was quite arefreshing change of pace!

The p&c industry has the facts–and history–on its side. Theyhave run the gauntlet in this economic meltdown and lived to tellthe tale. They should refuse to take any abuse from anybody whodares to suggest otherwise.