John Cosgrove Had It Right

My mentor John Cosgrove, the former editor of National Underwriter, was until the day he died a few years back at age 94, at least to the few of us like myself still around to remember, the acknowledged dean of American insurance journalists.

By Thomas J. Slattery

He was also one of the funniest men alive, a cross between W.C. Fields and Groucho Marx.

He spent many years observing the business, and like myself he developed some callouses along the way. John never remotely irritated me, except when he wrote those countless and colorful columns and editorials which, for those of you who never saw them, I can boil down to six words: "There's nothing new under the sun," especially the insurance sun. This offended my youthful idealism. But now that I'm old and cranky and a touch cynical myself, I'm beginning to think John was right.

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I filed this column at the beginning of the new year, when with drink in hand, we watched that big ball descend on Times Square and plunge us all into yet another surely transformative year. A day later, it didn't escape our notice that nothing much changed. By the time you read this, there will be more and ample evidence that this is so.

Take insurance. Just what are we looking at, after all, as we charge forward into 2008? We're still (and forever) talking about TRIA, even though that issue is at least somewhat resolved. We'll still be talking (now and forever) about a national catastrophe measure, the broker compensation matter and, of course, about an optional federal charter in the regulatory arena, to name but a few.

TRIA is a prime example. The president, at year end, signed into law, after interminable congressional debate, a compromise measure that leaves agents and brokers somewhat relieved but pleases few in the industry in the long run.

The law extends a federal reinsurance backstop for the terrorism peril for another seven years and adds coverage for domestic terrorist events. It uses the old dodge of initiating "studies" on the questions of group health and life insurance coverage and of coverage for nuclear, chemical and biological attacks.

The final bill won't include coverage for nuclear, chemical, biological and radiological attacks nor will it cut the trigger for reinsurance backing from $100 million to $50 million. The industry generally applauded its passage, but what else could it do?

Joel Wood of the Council of Insurance Agents & Brokers said, "The extension for seven years will provide much needed certainty for developers that terrorism coverage will be available and affordable well into the future."

Bob Rusbuldt, CEO of the Alexandria, Va.-based Independent Insurance Agents and Brokers of America, commented, "This legislation is crucial to maintaining affordable terrorism coverage, and bring certainty to policyholders, insurers and the insurance market as a whole."

That said, the song is over, for now, but the melody lingers on. Rep. Barney Frank of Massachusetts, the chief proponent of the House version, of the bill vowed as much. "This isn't over" he says.

Sadly, the odds are long that much else will happen to advance the industry's positions in 2008 because, as always, the lawmakers won't stick their necks out for an industry they know their constituents dislike.

TOM SLATTERY, a veteran editor and writer on industry affairs for more than 40 years, is Managing Director of Slattery-Esterkamp Communications in Baldwin, N.Y.

February 14, 2008

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