Year-End Odds & Ends
Its no surprise that Eliot Spitzer is running for governor. New Yorks crusading attorney general has had his eye on the prize for a long time, and the recent declaration of his candidacy was only a formality. The question now is how much publicity will he squeeze out of his latest reform targetthe insurance industryto keep his name in the headlines as he raises millions for his war chest?
Meanwhile, Marsh is moving quickly to put an end to its misery, hoping to reach a settlement of the civil suit filed by Mr. Spitzer accusing the worlds largest brokerage of bid-rigging and contingency fee abuse. The funny thing is that the key player who must sign off on any dealthe new head honcho at Marsh & McLennan Companies, Michael Cherkaskywas Mr. Spitzers boss when they worked together for Manhattan District Attorney Robert Morgenthau.
The two have more than merely kept in touch. The Dec. 13 edition of Newsday reported the pair still plays tennis together from time to time, that Mr. Spitzer wrote a back-cover blurb in praise of "Forewarned" (Mr. Cherkaskys book on terrorism), andmost interestinglythat since 1998, MMCs chief exec has contributed $18,500 to the attorney generals campaign coffers.
However, both insist their personal relationship will have no impact on settlement negotiations. There has to be some truth to that, since it wouldnt serve Mr. Spitzer to let his biggest fish off the hook without a major penaltyprobably in the neighborhood of half-a-billion dollars. Still, it cant hurt Marsh to have a friend-of-Spitzer so prominently in the mix.
On a more positive note, Lloyds of London announced last week that its chairman, Lord Peter Levene, would be staying on for an additional three-year term beyond his current stint, which isnt due to end until next November. This is good news for Lloyds, as Lord Levenethe first outsider to head the venerable institutionhelped reestablish the markets credibility and spur on much-need reforms.
Under Lord Levenes shrewd guidance and the diligent day-to-day management of CEO Nick Prettejohn, Lloyds is a far more efficient, transparent enterprise. In the meantime, Julian James, director of worldwide markets, has given Lloyds a much friendlier public facewhen it comes to the markets accessibility and media savvy, there is no comparison to the old days when press coverage was actively discouraged.
Lloyds has kept syndicates on a tighter leash under its franchise concept, but the markets true test is just beginning now that pricing is more competitive. The early signs are positive, as Lloyds announced a 9 percent drop in its expected capacity for 2005, reflecting a commitment to underwriting discipline and profitability.
Last but not least, belated kudos to two classy gentlemen who made a tremendous impact on the industryJack Ramirez and Rodger Lawson. The two capped their careers by pulling off a long-discussed merger between the NAII and the Alliance to create the Property Casualty Insurers Association of America at the start of the year, then stayed on to see the transition through before retiring this fall.
Both were dedicated proponents and effective communicators of their association agendas. I will especially miss sparring with Jack during his annual visits to debate our editorial positions. He was firm but always respectful of an opposing point of viewan attribute too often lacking in todays toxic political environment. We wish them both the best.
Indeed, we wish all of our readers a very happy and healthy new year!
Sam Friedman
Editor-In-Chief
Reproduced from National Underwriter Edition, December 16, 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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