Terrorist Attack Likely To Have Modest Impact on Property Insurers

Although Tuesday‘s terrorist attack on the World Trade Center building is a terribly tragic event, the impact on the property insurance industry is likely to be modest, according to a preliminary analysis by Weiss Ratings Inc., a provider of independent insurance company ratings and analyses. Weiss Ratings has no specific data to support commentary on insurance for the Pentagon or coverage on commercial aircraft.

On the other hand, insurers with workers‘ compensation or business interruption exposure are at the greatest risk since there is no limit to the amount of claims they might incur.

"In terms of property damage, this is roughly equivalent to the impact of a major hurricane. It is a blow to property insurers, but it is something they are generally prepared to absorb so we are unlikely to see a rash of failures," commented Martin D. Weiss, Ph.D., chairman