Yesterday's tragic terrorist attacks on the World Trade Center and the Pentagon may be hundreds of miles from the state of Alabama, but it is our nation and our world turned upside down on September 11, 2001. The effect on the economy from insurance industry losses related to this event will be broad and long term. Joe Annotti, Assistant Vice President of the National Association of Independent Insurors (NAII), told the National Underwriter that it will take a lot of time before any official insured loss estimates can be determined. "This is the most costly, catastrophic, man-made disaster in the United States," says Alabama Department of Insurance General Counsel Michael Bownes. The Wall Street Journal reports that insurers and reinsurers will experience between $10-$20 billion dollar losses, with $5 billion of that property damage in the financial district of New York City. These figures do not include workman compensation, medical costs, payments to families, business interruption losses, etc. The previous most expensive man-made disaster in the U.S. was the 1992 riot in Los Angeles, which caused $775 million dollars in property damage. These riots are just a mere shadow of what Tuesday's devastating losses will mean for the insurance industry. In comparison, Hurricane Andrew is credited as being the most destructive natural catastrophe. The 1992 hurricane destroyed much of South Florida causing $15.5 billion in property insurance losses. 

A number of insurance companies and associations had offices in the World Trade Center Towers including the following: The Hartford Insurance Group, Marsh & McLennan Companies Inc., RLI Insurance Company, Metropolitan Life Insurance Co., Continental Insurance Company, AON Corporation, Fireman's Funds Insurance Company, Allstate Insurance Company, Guy Carpenter, Seabury & Smith, Hal Roth Agency Inc., Kemper Insurance Companies and AIG Aviation Brokerage, Inc. The number of survivors and casualties are still unknown. The Hartford Group is pleased no casualties have been reported. RLI also reports everyone in their office survived. Gary Hammons, an Allstate representative in Birmingham reports that it is business as usual, and they are expecting no interruptions in day-to-day operations. 

"We should offer our prayers, sympathies, and support for those families and companies directly affected," says AIIA President Malcolm Dunaway. "We should commit ourselves and be ready to help out as needed." It is also important that we, including our clients, as a collective group remain patient and supportive as some businesses may experience delays. 

With US financial markets closed Tuesday and today, it is hard to ascertain the financial impact to the insurance industry. Travis Pascavis, an insurance stocks analyst for Morningstar Inc., in Chicago, said in an interview with the New York Times that US insurance stocks are likely to be hit hard once trading resumes. He expects a 10% drop as the market will be wary of these stocks until the extent of losses can be defined. Overnight insurance stocks in Europe plunged by more than 10% in the aftermath. Still, Pascavis anticipates that the insurance industry shouldn't have too many problems paying the claims arising from these terrorist strikes because "Most of the major companies are in strong financial health, despite the slowing economy." 

Insurance officials have also said that costs were unlikely to be high enough to threaten the industry's stability. "The industry can certainly absorb a loss [of this size] without causing major disruption or insurance failures," said David Lackey, president of an independent rating agency in Palm Beach Gardens, Fla. 

As financial markets were weakening prior to yesterday, experts say they expect premiums to rise across commercial property insurance markets. The disaster will also increase pressure for improved security and structural safety. It is predicted that reinsurers will probably bear some of the biggest losses from the attack.
IIAA CEO Robert A. Rusbuldt said that "as a community, the insurance industry is deeply impacted by these barbaric acts." He continues to say that the entire industry will work together for recovery. "Insurance will play an enormous role in the recovery of businesses and persons affected in New York City and the hundreds of thousands of people impacted in New York, Washington D.C., near Pittsburgh and nationally."
Lastly, the Independent Insurance Agents of America, (IIAA) and the Independent Insurance Agents Association of New York, ( IIAANY) are establishing a victims' recovery fund that will help victims and their families. Information about how people can contribute will be released in the next several days.

If you are contacted by local media representatives requesting comments, responses, or information, please allow your association office and staff to assist you. We are on top of the tragic situation and will provide information via phone, fax or e-mail. Please call us at (205) 326-4129 or Alison Ray via e-mail at aray@aiia.org

Make Plans to Attend IIAA's Hawaii InfoXchange

Honolulu, Hawaii, will host IIAA's 2001 InfoXchange October 27-30. More than 2,000 insurance professionals are expected at the Sheraton Waikiki to discuss industry issues, share new business ideas, develop professional relationships and access training on the latest technologies. The annual meeting will include the launch of IIAA's new marketing brand, Trusted Choice, plus a wide variety of technology workshops, innovative continuing education classes, new Best 

Practices opportunities, a series of prominent speakers, one of the largest exhibit halls in the insurance industry, the Young Agent Leadership Conference and many other exciting features. Republican political commentator Laura Ingraham; Ken Blanchard, author of One Minute Manager; and Insurance Learning System President Russ Granger are just a few of the notable presenters. Registration forms are available online at www.independentagent.com, by calling (800) 221-7917 or through IIAA's fax-on-demand service at (800) 296-0578, option 4010. 

Coming Soon! 2001 Small & Rural Agents Conference

This year's Small & Rural Agents Conference will be held October 10-11 at the Mountain Brook Inn in Birmingham. You will be brought up-to-date on what the latest legislative issues are facing our industry and what we can expect. There will also be two round-table discussions to choose from: National IIAA Membership & Services, or Company/Agency Relationships: Understanding Each Other. This year's educational programs will carry a total of 10 hours of CEUs: 1) Homeowners 2000 Program - 6 hours taught by David Thompson, and 2) Environmental Issues - 4 hours taught by Chris Bunbury. Informational pamphlets have been mailed to you that include registration and fees. If you have further questions, please contact Nancy Crowe at (205) 326-4129.

2^ND Annual BIG I PAC Golf Tournament

Mark your calendars now to attend the 2^nd Annual BIG I PAC Golf Tournament to be held on September 25, 2001, at the Robert Trent Jones Golf Course in Prattville. This Political Action Committee fund raiser is a watershed for us because the 2002 brings many challenges and opportunities for our industry. So just what is happening in 2002? The governor's race, both the state Senate and House races and redistricting. Contributions to our BIG I PAC allow us to financially contribute to election campaigns beneficial to our industry and business interests. Invite your local policy maker and join us for a round of golf that will aid in shaping the future of our state. Registration pamphlets have been mailed to you. Through our sponsorship opportunities, this golf event is a great way to promote your business. Feel free to bring merchandise with your company name/logo - these are great door prizes. Your company name can go on a tee boxes nameplate for a $100 donation. For more information contact Nancy Crowe at AIIA (205) 326-4129.

Continuing Education Opportunities - Agent License School

Spaces are still available for all remaining License Schools. These are the last available dates through February 2002. P&C Agent Licensing Schools will be taught following the schedule below. This course satisfies the Alabama Department of Insurance's 40 hour pre-qualification requirement. The cost, which includes the state approved text books is $220 for AIIA members, and $285 for non-members. Please call Lauren Mashburn at (205) 326-4129 or register online at www.aiia.org.

September 24^th - 28^th at the Bryant Conference Center in Tuscaloosa, AL
October 8^th - 12^th at the AIIA office in Birmingham, AL 
November 12^th - 16^th at the Four Points Sheraton - Airport in Huntsville, AL