Kansas Insurance Commissioner and National Association of Insurance Commissioners (NAIC) President Kathleen Sebelius discussed the effects of last week’s tragedies on the East Coast and how they could impact the Kansas insurance market.
Preliminary loss estimates from the insurance industry place the damages at $20 billion. Based on a wide array of insurance claims likely to arise from the tragedy, Sebelius noted it is hard to say exactly what the total will be.
A number of claims in property loss, business interruption, workers comp, health, life, auto, and aviation are expected. According to Sebelius, workers’ comp claims will greatly surpass the others because the tragedy caused a large loss of human life.
Sebelius notes that while there will be a large number of claims, she believes insurance companies will do their best to move claims expediently. The challenge will be in coordinating claims and damage assessment efforts of insurance companies with federal and state authorities. Sebelius adds through her role as President of the National Association of Insurance Commissioners, she has been talking with members of Congress about the efforts and challenges facing them. Sebelius will note together they will meet the challenge.
While the financial challenge of $20 billion is daunting, Sebelius encourages people to remember that in 2000, the insurance industry wrote more than $1 trillion in insurance premiums. Therefore, preliminary estimates of $20 billion represents two percent of the premiums written in 2000.
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