Most insurance executives surveyed at an industry conference last week said they believe civil litigation trends will likely remain stable in the year ahead.
The group was polled by the Insurance Information Institute at its 12th annual Property/Casualty Insurance Joint Industry Forum, held in New York.
Sixty-six percent of the executives polled believe that tort trends in 2008 will be little changed from 2007.
But 28 percent believe tort trends will deteriorate. Just 6 percent of those polled indicated that tort trends would improve.
Concerning legal action over insurers' refusal to pay claims involving policies with flood exemption language–"wind vs. water litigation"–the executives were confident of a positive outcome for carriers.
I.I.I. said 80 percent of respondents indicated that wind vs. water litigation was largely resolved in favor of the insurance industry.
When it comes to whether Congress will adopt a National Catastrophe Insurance Plan in 2008, 90 percent of respondents said they do not think it will occur. Additionally, 70 percent of insurance executives think the push for an Optional Federal Charter will not gain momentum on Capitol Hill in the year ahead.
Looking at consolidation, 80 percent of respondents thought there would be an increase both among insurers and reinsurers in 2008.
Robert P. Hartwig, I.I.I. president, noted that "soft market conditions and the accumulation of excess capital have historically been catalysts for increased merger and acquisition activity in the property-casualty insurance industry."
On the investment side, 54 percent said they expect the equity markets to have a down year. The majority of insurance leaders–56 percent–expect interest rates to fall in 2008, while 28 percent believe rates will remain flat.
Participants at the forum included nearly 250 representatives from property and casualty insurance and reinsurance companies and organizations. Of these, roughly 40 percent responded to the survey, I.I.I. said.
Poll questions and full results are online at http://www.iii.org/media/met/jif2008/.
For more on the poll and for CEO thoughts on the economy, see the National Underwriter, Jan. 14, in print and online.
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