NU Online News Service, April 9, 2003, 5:52 p.m. EDT — New York
Swiss Re, Zurich, and the life insurance industry have suffered through two tough years, but company executives who spoke here today said they are optimistic.
The stock slump and claims resulting from the Sept. 11, 2001, terrorist attacks have hit hard. But John Coomber, chief executive of the Swiss Re Group, said his company has sharply reduced its exposure to stocks and benefited from the growth of its life reinsurance business.
Jacques Dubois, chairman of Swiss Re American Holding Corp., said Congress could help his company’s life reinsurance operations by expanding protection against terrorist attacks.
The new Terrorism Risk Insurance Act, which protects property-casualty insurers against catastrophic, terrorism-related losses, is necessary because the frequency and severity of potential terrorist events is “unknowable,” Dubois said.
A meeting held in Washington last week dealt with the question of whether the government ought to create a similar program for group life insurers and individual life insurers, Dubois said.
In general, there seems to be an openness to listening to insurers and considering a plan that would be similar to the program offered for p-c insurers, Dubois added.
Bart Zanelli, a senior vice president at Fox-Pitt Kelton Inc., Swiss Re’s investment banking unit, said life insurance company stock prices also could recover.
Although share prices for life and health companies are down 4%, compared to a 1.75% year-to-date decline for the S&P 500 Index, that decline is due in part to “sins of the past,” such as promises of guaranteed minimum death benefits, Zanelli said.