A View from the Press Box

In a sure sign that times are tough all over, Santa Claus managed to get through this year’s Christmas deliveries, but cannot promise he’ll be stopping by anyone’s home in 2009 or beyond now that Treasury officials–egged on by Scrooge-like members of Congress–denied him a bailout loan to keep his North Pole enterprise from going under.

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In response to my recent postings about the lack of any positive insurance role models in pop culture, blog reader Doug pointed out the popular 2004 animated film, “The Incredibles,” where “the main character’s soul-sucking job is…an insurance adjuster!” When you learn more about this negative portrayal, it gets even worse for the industry.

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On Jan. 7, I peered into my crystal ball for the likely Top-10 Property-Casualty Insurance Stories of 2008. Read on to see how my predictions panned out, and feel free to comment.

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In case you thought insurance industry bashing in pop culture was a relatively recent phenomenon after reading my Dec. 8 entry about the negative image of evil carriers perpetuated in the new TNT drama “Leverage,” think again! Apparently, such knee-jerk slams go all the way back to the 1950s, and not even a sci-fi classic like “The Day The Earth Stood Still” could resist the temptation to take a cheap shot at this much-maligned business.

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The ancient Chinese curse, “May you live in interesting times,” never resonated more within the property-casualty industry than it did in 2008, when the fallout from the subprime mortgage crisis nearly destroyed the nation’s highest-profile carrier, seriously undermined the balance sheets of nearly everyone else, and set the stage for the worst economy since The Great Depression. These macro-economic factors and the political fallout from them helped determine the top insurance news stories in 2008.

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In my Nov. 26 blog entry, I commented on how odd it sounded when Jay Fishman, chairman and CEO of Travelers, said he buys his homeowners insurance from a competing carrier. A few of you set me straight, and laid out the potential conflicts of being covered by your own company. We were inspired to make this topic the focus of our quarterly column, “A Question Of Ethics.” Read on and please file your take in the comment section.

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The third-quarter financial recap was grim indeed, with premium volume dropping, underwriting losses soaring, and the bottom line plummeting into negative territory. You have to wonder at this point if the industry will end up in the red when the books are closed for 2008, let alone how many carriers and agencies will make it through the challenging year ahead in one piece.

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Can anyone explain to me where the federal govenment’s $700 billion bailout fund is coming from? Are we simply printing whatever money we need, and therefore heading the way of the infamous Weimar Republic–where the currency became so devalued people carried wheelbarrows full of cash to do basic shopping? Or are we raising the dough by selling yet more Treasury bills to the Chinese and other foreign borrowers? If that’s the case, no wonder credit markets are so tight, with so much capital being sucked up by Uncle Sam.

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Anyone who doubted whether Barack Obama would keep health care reform front and center on his legislative agenda due to his understandable preoccupation with our broader economic crisis was likely proven wrong today, as the president-elect introduced the former Senate majority leader, Tom Daschle, not only as his secretary of health and human services, but also as director of a new White House Office of Health Reform, where he will be the “lead architect” in crafting ways to expand coverage and control costs.

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One question left unanswered in the mad rush to keep the economy from sinking into oblivion is whether AIG’s federal bailout unfairly skewed the playing field against its competitors.

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