This past year saw the industry faced with issues both new andold. Some events were noteworthy for their general news impact,others for their direct influence on the property and casualtyindustry, and still others for the massive amount of interest theygenerated among PC360's readership.

Many of these issues remain unresolved, and are likely tofeature prominently in 2014. Not all issues were negative for theindustry, though. Solid financial performance and a mild hurricaneseason are welcome news for insurance professionals, and even areasthat represented challenges for the industry in 2013, such asimplementation of Obamacare, could also offer opportunities formany in the future.

Click “next” to see PC360's top-10 stories of 2013

10: Boston Marathon Bombings

Running sneakers hang asmemorial about two weeks after the Boston Marathon bombings onApril 15. (Photo by Chad Hemenway)

Two explosions rang out near the finish line of the Boston Marathon on April15, and while the event did not result in a huge payout forproperty and casualty insurers, it did have some measure of impacton the industry.

The explosions left three dead and hundreds injured, and alsodamaged property in the vicinity.

As of September, the Massachusetts Division of Insurance saysinsurers paid about $1.18 million in claims in Boston as well assurrounding communities such as Watertown, Mass. and Cambridge,Mass. Business interruption claims were the most common type ofloss.

This story makes the top-10 based more on its overallnewsworthiness rather than a direct impact on the P&C industry,but the event could factor into the debate over an extension of theTerrorism Risk Insurance Act. Insurance associations were rightfully reluctant to draw any connection immediately after thebombings, insisting that the focus then should remain onassistance and recovery. But some did note that when the TRIAdebate resumed, it would do so with this event serving as areminder of the threat the country faces.

9: A Tragedy That Led a Chairman to Resign

Josef Ackermann, shown in this AP file photoas CEO of Deutsche Bank, resigned Aug. 29 over the apparent suicideof Zurich's CFO.

In August, Josef Ackermann resigned as chairman of Zurich Insurance after the suicide ofthe company's Chief Financial Officer Pierre Wauthier.

Reuters reported Ackermann's statement: “I have reasons tobelieve that the family is of the opinion that I should take myshare of responsibility, as unfounded as any allegations might be.As a consequence, I see the possibility of a continued successfulboard leadership to the benefit of Zurich called intoquestion.”

Wauthier described himself in a note as demoralized after monthsof a new, more aggressive tone at Zurich under Ackermann, Reutersreported, citing “several people who have seen the letter.”

A Zurich review released in November cleared Ackermann of anyblame in the suicide.

Earlier this month, George Quinn announced he was leaving Swiss Re to assume the CFO position at Zurich.

8: Obamacare Implementation

President Barack Obama speaksduring an election night party in Chicago. (AP Photo/MattRourke)

While the shaky Obamacare rollout has been a bigger story onPC360's sister site, LifeHealthPro, the issuesarising from the law and its implementation have spilled over toareas of the P&C marketplace.

Arthur J. Gallagher CEO Patrick J. Gallagher continues to statethat the law is creating demands for services from big brokers such as AJG thatare able to handle the increased compliance requirements, at theexpense of smaller independent agencies that find themselves unableto keep up.

National Underwriter Executive Managing Editor LauraToops listed Obamacare in her roundup of the biggest challenges and opportunities for independent agents in2014, noting that while the new law is tough to navigate,agents can still take a leading role in educating clients abouttheir options.

From an insurance technology standpoint, Jerry Poole, presidentof Acrometis, writes that the troubled launch of HealthCare.govcould serve as a lesson for P&C insurers launching their owntech services, highlighting the importance of trial and error over high-profile launchschedules.

Sam Friedman, research team leader at the Deloitte Center forFinancial Services, makes a similar case regarding lessons for commercial insurerslooking to launch platforms to sell insurance directly toconsumers.

As for the P&C marketplace, Marsh reported earlier this month that directors and officers liability ratesfor healthcare organizations climbed in the third quarter due inpart to antitrust concerns arising from the industry's changingbusiness models pursued in response to the healthcare law.

7: Cyber Security — Increasing Threats and IncreasingInterest

Throughout the year, articles about cybersecurity and coverage were of increasing interest to PC360'sreaders.

By the end of the year, a major breach at retailer Target showed why the topic has beenbuilding in interest.

A Lloyd's of London survey of 600 C-Suite and board-levelexecutives in August listed cyber threats among the top-three riskscorporations face.

A Towers Watson survey of global insurance executives in November listed cyberwarfare as number four in its “Top-10 Most Extreme Risks.”

In October, speaking at the Property Casualty InsurersAssociation of America's Annual Meeting, former Secretary ofHomeland Security Michael Chertoff said cyber security is themost significant threat we face.

The issue of cyber risk, he said, “affects virtually every kindof enterprise,” with motivations ranging from terror plots to“hackivists,” to a disgruntled employee or customer or evenaccidental leaks.

6: Solid Performance for the Industry

Insurance Information Institute President Robert Hartwig saysthe P&C industry appears on track for its best year in the post-crisis era thanks to lower catastrophelosses and higher premiums.

Through the first nine months of the year, according to datareleased by ISO and the Property Casualty Insurers Association ofAmerica (PCI), net income after taxes rose to $43 billion for theindustry, compared to $27.8 billion in the same period of 2012. Thefourth quarter is also expected to be more profitable than2012's.

The industry's combined ratio improved to 95.8 for the firstnine-months of 2013 from 100.7 for nine-months 2012.

The solid performance has led various ratings agencies to declare a stable outlook for the P&C industry heading into 2014.

However, the results have also led to questions about how long the environment of steady rate increases can last.

5: Legends Pass On

Jack Byrne (top) and Peter Lewis(bottom)

In 2012, NU released its “Top25 Living Legends of Insurance.”

This year saw two of those legends, Jack Byrne and Peter Lewis,pass on.

Byrne died at his home in Etna, N.H. on March 7 after a long battlewith cancer. He was 80 years old.

Byrne was listed at number 8 in NU's Living Legends feature. Hiscareer accomplishments include leading impressive turnarounds atGEICO and Fireman's Fund.

Lewis died of a heart attack at his home in Coconut Grove, Fla.,also at the age of 80.

He was listed at number 2 in NU's Living Legends feature,credited with being behind many important innovations atProgressive Insurance.

4: The Hurricane Season That Wasn't

There are many sayings about the difficulty in predicting theweather, and forecasters received a harsh lesson in that areaduring this year's hurricane season.

The average for the Atlantic hurricane season from June toNovember is 12 named storms, six hurricanes and three majorhurricanes. Most forecasters predicted an above-average season for 2013.

NOAA's Climate Prediction Center in May called for 13-20 namedstorms with 7-11 hurricanes and 3-6 major hurricanes. ColoradoState University (CSU) called for 18 named storms, nine hurricaneand four major hurricanes. The Weather Channel's Weather ServicesInternational called for 16 named storms, nine hurricanes and fivemajor hurricanes.

The final results when hurricane season ended? Thirteen namedstorms, two hurricanes and no major hurricanes, or as CSUresearcher Phil Klotzbach says, “…one of the largest busts for our research team in the 30 years we've beenissuing this report.”

Instead of making headlines for being an above-average season,2013 instead will go down as the “quietestU.S. Atlantic hurricane season in decades,” according to FitchRatings, and a season with the fewest named hurricanes since 1982.The quiet season is expected to cause a drop in reinsurance ratesat Jan. 1 renewals.

However, the quiet season should not fool insurers. As Fitch says, the “modest respite…does not diminish perspectiveson the potential risks of natural disasters as population andproperty exposures in coastal areas and earthquake prone regionscontinue to expand.”

3: West Fertilizer Explosion

On April 17, tens of thousands of pounds of ammonium nitrateexploded at the West Fertilizer Co. in West, Texas, levelingnearby homes, killing 15 people and injuring hundreds more.

The story generated major interest among PC360's readers mostlydue to the risk-management implications of storing so much ammoniumnitrate so close to schools, apartment complexes and a nursing homeas well as the small amount of liability insurance (and lackliability insurance requirements) held by the plant.

The West Fertilizer Co. carried just $1 million in liability insurance. Lawsuitsfiled in the wake of the explosion included legal action taken bysome W.R. Berkley Corp. companies that insured nearby properties.Paul A. Grinke, the attorney for the group, told PC360,“Unfortunately I'm involved in a lot of cases dealing withunderinsured properties, but I've never been involved in somethinglike this—a facility such as this one with so little insurance forthe risk.”

The Insurance Council of Texas puts insured property losses forthe disaster at about $100 million, but that figure could increase.The total includes estimated insurance payments for the plant, 140homes, an apartment complex, a middle school and a retirementcenter.

The Texas Department of Insurance says four state agencies with some oversight—the Department ofState Health Services, the Office of the Texas State Chemist, TexasCommission on Environmental Quality and the Texas Department ofAgriculture—do not require general liability coverage at anoperation like West Fertilizer.

2: NFIP Uncertainty…Again

Like a horror movie villain that always seems to come back tolife no matter what's thrown at it, uncertainty around the NationalFlood Insurance Program re-emerged this year even after a five-yearextension of the program with reforms was passed in 2012.

The issue now? Fears among legislators, regulators and variousgroups that the law's mandated premium increases for someproperties — designed to phase in actuarially sound rates and bringstability to the NFIP — are too steep and unfair to homeowners and businesses in theimpacted areas.

This year saw statements and actions by legislators as well as legal action taken by states all in an effort to delay the ratehikes from taking place until an affordability study could beconducted.

PC360 Washington Bureau Chief Arthur D. Postal lists the ongoinguncertainty surrounding the NFIP in his top-5 industry Washington issues for 2014.

He notes that Congressional action, and in some cases inaction,throughout this year seemed to indicate a lack of appetite to passa delay, but recent developtment will see the Senate take uplegislation early next year.

The legal action taken by Mississippi and other states isexpected to be decided shortly as well.

1: The Continuing Evolution of Federal Involvement inRegulation

In July, American International Group was officially labeled “systemically important,” paving the way forfederal regulation of an insurer for the first time in 150years.

At the end of the year, the Federal Insurance Office released its long-awaited report on regulatory modernization,calling for a hybrid state/federal approach to insuranceregulation.

These actions, pursued in accordance with the Dodd-Frank Act,have reignited a longstanding federal vs. state regulation debatewithin the insurance industry.

Some in the industry saw the FIO's report as striking the right balance on the issue. Others responded tothe report by ardently defending state-based regulation, andcautioned that the report could be a first step toward an increasedfederal presence.

Insurance Information Institute President Robert Hartwig saysthe first step has already been taken, as Dodd-Frank is the law ofthe land and “already codifies parts of the hybrid approach toregulation that the FIO report contemplates.”

PC360 Washington Bureau Chief Arthur D. Postal lists federal vs.state regulation in his top-5 industry Washington issues for 2014.