CEO Corner

Looking back at 2007
Over the course of 2007, I have been pleased to deliver to you the industry news that matters to your business. Part I of this PCI SmartBrief special year-end report rounds up the most important trends, stories and events of the past year. Part II, which will hit your inbox on Thursday, will provide a glimpse into what's in store for 2008.

Enacting a long-term terrorism insurance backstop, dealing with catastrophic risk issues at the state and federal level, and a continued push for a more effective and efficient regulatory environment topped the list of 2007 advocacy objectives for the Property Casualty Insurers Association of America.

The Terrorism Risk Insurance Act expires on Dec. 31, but the threat of terrorism does not. The time sensitivity on terrorism insurance makes this issue a priority not just for the insurance industry but for the entire business community and the U.S. economy. Hundreds of PCI members participated in grassroots activities regarding this issue – from writing letters to members of Congress to meeting personally with key political leaders – to support the TRIA advocacy campaign.

Other key PCI advocacy objectives included a variety of catastrophe issues at the state and federal levels. Among these were a continued push for reforms of the National Flood Insurance Program, evaluating the need for enactment of state catastrophe programs, establishing the framework for a long-term solution to help stabilize the Florida property insurance market, and preserving the financial strength and structure of the California Earthquake Authority.

While the nation has benefited from another relatively quiet hurricane season, the recent wildfires in California demonstrate that the risk of catastrophic loss continues to be greater now than it's ever been. More people live in harm's way, and the value of property exposed to catastrophic risk is higher than ever. These conditions will make it imperative that insurers, consumers, state legislatures and Congress work together to improve our nation's ability to prepare for, respond to and recover from natural disasters.

The largest gathering of property/casualty insurance leaders in the U.S. met in Boston this year. The annual event was attended by hundreds of CEOs and senior executives of property/casualty insurance companies, reinsurers, brokers, intermediaries and underwriters. Participants heard presentations from leading thinkers on politics, public policy, economics and journalism. It was an exciting year, indeed.

Best of 2007

• Liberty Mutual, Ohio Casualty to merge (5/7)

• More property insurers pull out of East Coast (10/16)

• High court rules in favor of insurers in credit reports case (6/5)

• Jury awards $2.5M to Mississippi couple in State Farm case (1/12)

• California sinkhole damages several homes (10/3)

• Computer simulation shows how WTC towers disintegrated (6/21)

• Homeowner disappointed by $70,000 jury award (8/15)

• Emergency order by Florida governor confuses consumers, insurers (2/2)

• A.I.G. eliminates 600 jobs with unit consolidation (9/28)

• More employers expected to use penalties for high-risk workers (9/10)

Your Favorite SmartQuotes

Here are the quotes you shared with colleagues most often during 2007:

The pessimist sees difficulty in every opportunity. The optimist sees the opportunity in every difficulty."

--Winston Churchill,
British prime minister

A positive attitude may not solve all your problems, but it will annoy enough people to make it worthwhile."

--Herm Albright,
writer

When you step into a turnaround situation, you can safely assume four things: morale is low, fear is high, the good people are halfway out the door, and the slackers are hiding."

--Nina Disesa,
as chairwoman of McCann-Erickson Worldwide

If toast always lands butter-side down, and cats always land on their feet, what happens if you strap toast on the back of a cat and drop it?"

--Steven Wright,
comedian, actor

The three great essentials to achieve anything worthwhile are, first, hard work; second, stick-to-itiveness; third, common sense."

--Thomas Edison,
inventor and businessman

One of the hardest tasks of leadership is understanding that you are not what you are, but what you're perceived to be by others."

--Edward L. Flom,
CEO of Florida Steel

Do what you feel in your heart to be right -- for you'll be criticized anyway. You'll be damned if you do, and damned if you don't."

--Eleanor Roosevelt,
former first lady and American political leader

The statistics on sanity are that one out of every four Americans is suffering from some form of mental illness. Think of your three best friends. If they're OK, then it's you."

--Rita Mae Brown,
writer and activist

People, even more than things, have to be restored, renewed, revived, reclaimed, and redeemed; never throw out anyone."

--Audrey Hepburn,
Academy Award-winning actress, humanitarian

Rule No. 1: Use your own good judgment in all situations. There will be no additional rules."

--Bruce, Jim and John Nordstrom,
co-presidents of Nordstrom department store, in the employee handbook

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