It's Time To Repair Industry's Reputation: Lloyd's

Commenting on the litigation that pitted World Trade Center leaseholder Larry Silverstein against his property insurers in 2004, Mr. Levene cited National Underwriter's fall survey that found only 23 percent of risk managers received their final policies in a timely fashion and error free.

In the Silverstein case, he also noted, only one insurer had issued a final policy on the World Trade Center prior to the 9/11 attacks.

"The insurance industry owes it to its customers as well as to itself to ensure that cover is fully agreed and clearly documented right from the start," Mr. Levene said. "To any outsider, it must seem highly unusual that this single agreement should not be in place."

Lord Levene also argued that Attorney General Spitzer's ongoing investigation of the insurance industry emphasized the need for greater transparency for the industry.

"We need to take careful stock of our inter-relationships and workings," he told insurers. "We need to be clear and unambiguous on who is doing what exactly, for whom, and at precisely what cost."

Mr. Levene also commented on the Asian tsunami tragedy that claimed more than 150,000 lives in over 10 countries. He said it occurred during a record year for natural catastrophes with insured losses over $50 billion, including a record typhoon season in Japan and the four major hurricanes that hit Florida. This was a sharp reminder that the risk from natural catastrophes is increasing and insurers need to rethink how they evaluate financial risks, he said.