International Insurance Society Turns 40 Since IIS founding, insurance industry has seen many changes
The world looked like a very different place 40 years ago in 1964, when the nonprofit educational group International Insurance Society Inc., then some 40-members strong, held its inaugural meeting in Austin, Texas.
That year, the cost of regular gasoline was 30 cents per gallon and color television was just making its way into the consumer market. On the U.S. music scene, Bob Dylan, the Grateful Dead and Jefferson Airplane were all the rage in the counter-culture movement. In sports, the all-powerful New York Yankees were in the World Series. (Well, maybe some things dont change that much.)
The insurance industry also looked very different back then, when the IIS held its first meeting, according to Patrick Kenny, the current chief executive officer at the International Insurance Society. With respect to issues impacting the property-casualty sector, "the courts were jammed with auto liability claims at that point in time. There was no 'no-fault' insurance," he said.
"There were no asbestos claims, no lead, no moldno environmental claims. There were just no such claims anywhere in the world," he continued.
Mr. Kenny added, "There were very few global alliancescompanies were really staying within their national borders. There was really no Bermuda marketplace at the time."
Mr. Kenny also noted that on the reinsurance product-development side, "there were no finite reinsurers, and very few global reinsurers. And specialty companies hadnt arrived on the scene yet." There have also been significant changes in policy forms since 1964, from occurrence to claims made, and theres been an emergence of new forms and special coverage.
The insurance businessalong with the broader economyhas gotten a bit more complicated since then, but Mr. Kenny also pointed out that no matter how much the marketplace is transformed, the bottom line still remains the samethat businesses with clear and articulated strategies, executed by capable people, can rise to meet just about any challenge the industry has to offer.
The IIS will tackle some of these challenges in its upcoming annual meeting and seminars, as it has done for the past four decades. On July 11, the IIS will formally turn 40 years old, when the groupnow with some 800 members, consisting of senior insurance and financial executives from various parts of the global marketplaceconvenes its annual worldwide gathering in London.
"We will have members coming from all over the world. We have strong contingents from North America, Asian regions and Europe," Mr. Kenny noted.
The IIS yearly event, a forum of global executives and academicians, is an opportunity to examine and discuss the financial world, the global environment and other matters affecting the insurance industry. This year, the meeting will offer panel discussions with leading insurance executives, such as Swiss Reinsurance Companys chief executive John Coomber, Bermuda-based XL Capitals chief executive Brian OHara, and Tomijiro Morita, president of Japan-based Dai-ichi Mutual, and also Patrick Thiele, chief executive for PartnerRe in Bermuda.
Some of the topics that will be discussed in London include best practices in risk management and risk measurement, and how to best leverage and protect capital. Mr. Kenny said, "significant capital has come into the market, but it has to be used in a way that benefits shareholders, not merely used to plug holes in past problems like asbestos and environmental reserves. This is a worldwide issue."
Another panel discussion is titled, "Whos Running This Industry, Anyway?" and it will look at, among other things, the impact of regulatory changes and whether rating agencies are perhaps wielding too much power.
Additionally, the IIS will also unveil its new, cyber Insurance Hall of Fame during its London gathering. The Hall of Fame, whose inductees are selected by members of the International Insurance Society in a secret ballot, now has 111 laureates from over 20 countries and is currently operated in New York by the IIS. Beginning July 11, the displays will also be accessible through the new Hall of Fame Web site, www.insurancehalloffame.org.
"So much has changed since the IIS was founded," Mr. Kenny said. "But our purpose then, as it is now, is to bring senior insurance managers in various regions to come together and talk about the current issues and challenges affecting their markets and the broader global industry."
Mr. Kenny also remarked that even as the insurance industry continues to change and evolve, there is one constant theme: exploring for opportunities and expanding into new markets. And he noted that there are many opportunities now for such strategies, by tapping into emerging or newly opening markets.
"Certainly China is a rapidly expanding area but initially it may offer more opportunities for the life sector than the p-c sector," he said. "And as more of the Eastern European countries become more westernized, they will turn into growth areas also."
Other avenues of growth include advancing technologies, Mr. Kenny observed. "One area involves evaluating risk parameters for highly technologically dependent businesses," he said.
And as technologies continue to evolve, people as well as businesses that are dependent on such technologies become exposed to whole new areas of risks. For example, he said, conducting business or transmitting data over the Internet now poses a whole new set of risk issues. "Then there is the whole area of identity theft that previously didnt exist to the extent it does today, because of the explosion of technologies."
Reproduced from National Underwriter Edition, July 1, 2004. Copyright 2004 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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