What’s new: In brief (March 14, 2005)

U.S. legislators are looking to the insurance industry to provide a long-term roadmap for providing terrorism coverage before agreeing to extend the Terrorism Risk Insurance Act beyond its December 31, 2005 sunset. In an editorial written for the Property Casualty Insurers Association of America (PCI), House Majority Leader Tom Delay writes, “As Congress begins its debate on the future of how we insure against terrorism, it is imperative that the industrywork with Congress to develop a long-term solution that does not involve the federal government serving as a reinsurer or permanent backstop If the industry will work with us on Capitol Hill to find a way to accomplish this, we will likely be more understanding of a limited, short-term program to help get it started.”

The Wall Street Journal sent shockwaves through the insurance industry Monday, reporting AIG CEO Maurice “Hank” Greenberg will announce his resignation this week. The report said sources indicted the various regulatory investigations into the company prompted the decision, but added Greenberg may remain as chair of the company. WSJ also named vice chair Martin Sullivan as Greenberg’s likely successor.

Small health insurers continue to disappear as large carriers gobble them up, according to a new study by Conning Research. The study suggests the number of small companies will dwindle further over the next few years currently small carriers control less than 10% of the health insurance market. Large carriers are particularly drawn to the local knowledge and relationships enjoyed by the remaining successful small companies, the report adds.