The unexpected election last week of Sen. Trent Lott, R-Miss, toa top post in the Republican caucus has cast gloom overproperty-casualty insurance representatives.

Sen. Lott is currently engaged in a legal battle with his homeinsurance carrier. He recently inserted a provision in anappropriations bill requiring the Department of Homeland Securityto investigate insurers' handling of Hurricane Katrina claims.

Sen. Lott's election to minority whip, the party's secondranking Senate leadership post, has the industry privately girdingfor battle, while hoping his appointment will not result inpunitive legislation against the insurance sector.

Sen. Lott, who in 2002 lost out on a leadership post aftercomments he made appeared to praise the segregationist position ofSouth Carolina Republican Sen. Strom Thurmond, was elected in a25-24, vote over Sen. Lamar Alexander, R-Tenn.

Sen. Lott is suing State Farm over the insurer's decision todeclare part of the damage from his house on the Mississippi GulfCoast as partly flood-related and therefore not covered by hisinsurance.

He also has vowed to introduce legislation in the next Congressthat will repeal the antitrust exemption component of theMcCarran-Ferguson Act, the lynchpin of the current, state-basedregulation of the industry.

Only one insurance lobbyist, John Jonas, would be quoted byname; many property-casualty sector representatives would not,concerned any comment might be taken amiss by Sen. Lott.

Mr. Jonas, a senior partner at Patton Boggs, said that Sen. Lottwould have to moderate his anger at the industry.

“In the end, Republicans, like Democrats, must show somecivility, some legislative accomplishments,” Mr. Jonas said. “Goinginto a death crouch isn't going to work.”

Another lobbyist said, “For the property-casualty insuranceindustry and State Farm in particular, the election of Trent Lottis adding insult to injury after the Republicans, who theyoverwhelmingly support, lost both Houses of Congress to theDemocrats,” said one.

He added, “He has them in his crosshairs and will make theirlives miserable and will use his leadership position to thwarttheir legislative agenda. Bye-bye, McCarran-Ferguson!”

Another industry representative said, “[Sen.] Lott's McCarranbill is predicated on the view that McCarran is the holy grail ofthe industry, and this would hurt us.”

The lobbyist added that Sen. Lott is taking the same approacharticulated by Rep. Gene Taylor, D-Miss., another congressman suingthe industry as a result of Hurricane Katrina.

“Remember, he had very little enthusiasm for the originalTerrorism Risk Insurance Act when he was majority leader, althoughhe ultimately voted for it,” the lobbyist said. “He hates us, StateFarm most of all.”

American Council of Life Insurers spokesman Whit Cornman saidthe group hopes any legislation dealing with McCarran-Ferguson isundertaken in the context of the Optional Federal Charter, which itsupports.

“A discussion of McCarran-Ferguson belongs as part of anyoverall optional federal charter debate,” he said. “If Congress isgoing to consider McCarran-Ferguson, it should do so as part of thebroader discussion of an optional federal charter and insurancemodernization, and not as an isolated matter.”