September 09, 2004
Terrorism: The New 21st Century CAT Permanent government backstop would safeguard nation's economy
Why should risk managers and other top corporate insurance buyers care whether the Terrorism Risk Insurance Act is renewed?
Through decades of detailed analysis and hard-won experience, insurers have learned to better manage the potentially high costs associated with earthquakes, hurricanes, tornadoes and wildfires. As a result, the threat these natural catastrophes present to insurers has been lessened.
The same cannot be said for terrorism, however. This man-made threat, which is limited only by the imagination of a terrorist, is one that insurers simply cannot forecast.
Posted by Tom Troceen