As the insurance industry braces for potentially crippling claims in the wake of the Sept. 11, 2001, terrorist attacks in New York City and Washington, D.C., there is no doubt among industry analysts that the tragedy will forever alter the way insurers do business. Going forward, more of these policies will most likely exclude losses due to terrorist acts.
"The world‘s largest insurers have a piece of this risk," says Robert Hartwig, the chief economist for the Insurance Information Institute in New York, who witnessed the disaster. "Although the losses will not threaten the industry‘s solvency, they will be a significant drain on the industry‘s capital and will further ‘harden‘ the market."
