2007 was a rather staid year for the P&C industry, all things considered. Yes we had floods, windstorms, a few tornados, and those terrible California wildfires, but the other big nemesis, the reviled hurricane, did not ravage any Southeast coastal areas, as happened in 2004-05. (Yes, we had damage in some Mexican territories, but they were lightly populated and were not a major concern for the U.S. insurance industry.) That's not to say the industry is not facing challenges. There are a number of issues that we must be aware of as we go into 2008:

Boomer retirements are looming. As these experienced professionals in the adjustment arena move out of the active workforce, what are we doing to replace and train those who are stepping in to take over?

Workers' comp losses are diminishing, thanks to efforts by leading insurance states with legislative clout, like Florida, Texas, New York, New Jersey, and California. Other states, heretofore less vocal (like Illinois) are sure to pick up the banner.

How are legislative activities going to affect the industry, and adjusters in particular, in '08? We're contending with TRIA (a good thing!), no-fault extensions, and the continual efforts to curb fraud and its serpentine expansion.

Adjuster compensation is still lagging, and we're having continual difficulty attracting talented people to this challenging field. Should carriers and independents take up the standard to attract them to the field? And if so, how? What kind of incentives should we be offering?

Are the numerous state and national associations up to the task of going to bat on a more active basis to support industry incentives to recruit talent in the adjuster arena?

Are there geographical issues coming into play here? We're all aware of landslides in California, sinkholes in Florida, hurricanes in the Gulf region, and tornados in, well, everywhere. But what about the other crises? Like wildfires, for instance?

And yes, there's that pesky global warming issue. What's that going to do to coastal regions, where approximately 38 percent of the country's population resides?

Are we making the most of technology advances? What are you learning through your company's efforts? Your own?

And the good news: According to a recent report, the general liability line continues to see recovery in profitability, with a positive double-digit ROE. Much of this financial improvement comes as a result of reserve releases. Reflecting the history of volatility in this long-tailed line, forecasts through 2009 suggest a leveling in results, and possible turnaround.

For whatever good news, there's a damper here and there, but that's just an editorial opinion. Cat adjusters are suffering for lack of work and challenges, not that anyone wishes for a catastrophe, but still . . . Restoration firms are scavenging at sites of house fires, etc., if you get our drift. That was, until the California fires.

Yes, there was horrendous flooding in the southern Midwest and we're still dealing with Katrina in the Gulf Coast area, but a lot of the insurance challenges there have been met (even though that sounds somewhat cruel, facts are facts). Bottom line: 2008 will be a challenge in more ways than one, or two, or three.

Special Reports /

What Lies Ahead in 2008?

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