Buyers Urge Insurers To Be Reasonable On Terror Cover
To The Editor:
In response to the lead article on page 5 of your Dec. 2, 2002, edition, "Insurers Scrambling to Comply With New Terrorism Insurance Law," the Risk and Insurance Management Society acknowledges that pricing terrorism losses continues to be extremely difficult. However, RIMS strongly believes that with the passage of the Terrorism Risk Insurance Act, premiums must become more reasonable, capacity should expand, and limits should be available to cover buyers' needs.
RIMS member companies–nearly 4,000 commercial policyholders–expect implementation of the Act on a reasonably prudent basis. This critical legislation will go a long way to restoring our members' faith in the ability of the insurance and reinsurance markets to provide effective safeguards for both policyholders and insurers should future catastrophic terrorist events occur.
RIMS and its membership are counting on insurers to set fair rates for this new catastrophic risk, which threatens all sectors of our economy and the security of our world. It is critical that insurers act fairly and reasonably, considering all the assistance the buying community has given the underwriting community in securing this legislative remedy.
Christopher E. Mandel
President
Risk and Insurance Management Society
New York City
To The Editor:
It is reassuring to see that ACE is committed to keeping terrorism coverage at a reasonable rate, at least for the foreseeable future (see "ACE Does Not Expect Price-Gouging In New Terrorism Insurance Market," Dec. 16, 2002, page 9). Evan Greenberg and Brian Duperreault of ACE both recognize that gouging the consumer is not in the best interest of the insurance industry, nor in the mind of the risk management professional.
Killing the goose that lays the golden eggs only allows for a single meal. A fair pricing structure for reasonable terrorism coverage is the best approach for everyone involved.
Lance J. Ewing
Executive Director, Risk Management
Park Place Entertainment
Las Vegas, Nev.
Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, January 6, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.
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