American International Group Inc, Ace Ltd and other insurers are at odds over how to put a price on the once-unimaginable risks of terrorist attacks on US cities as a federal deadline looms.
Estimating terrorism losses has vexed insurance companies since the government last year ordered them to provide the coverage. With little data for analysis beyond the Sept. 11 attacks, underwriters have turned to former spies and military officials rather than actuaries to help them gauge risk.
A study by Insurance Services Office Inc, a research company that helps the industry set rates, recommended premium increases of as much as 150 percent. Regulators and several companies, including American International, the world's biggest insurer, rejected the proposal. Billions of dollars in premiums depend on the rates underwriters pick before Feb. 24, when by law they must set prices for terrorism policies.
"A lot of top insurance people can't figure out what to do," said Ira Shapiro, a New York-based real estate consultant whose clients own 140 million square feet of commercial properties. Insurers are so split about how to price such policies that his customers have received price quotes with rate increases ranging from 4 percent to 751 percent, he said.
Even before the terrorism bill passed in November, insurers turned to Insurance Services to help them tackle the problem. The company supplies statistical and actuarial information by analyzing events such as natural disasters. Its loss estimates are an industry standard in most states and are used as guidelines to price millions of policies.
Insurance Services asked its hurricane and tornado modeling unit, AIR Worldwide Corp, to create a formula to estimate losses from potential terrorist attacks on different US cities, said Jayanta Guin, AIR's vice president of research and modeling.
AIR hired former Marine Corps Colonel Edward Badolato, a security consultant who once led military teams against terrorists in Asia, Africa, the Middle East and Latin America. He and other ex-military and law-enforcement officials created a database of likely targets where terrorists may strike.
Critics of the study said that the cities with the greatest risk have increased security, which may push terrorists elsewhere.
ROLLER-COASTER RIDE: More than five earthquakes ranging from magnitude 4.4 to 5.5 on the Richter scale shook eastern Taiwan in rapid succession yesterday afternoon Back-to-back weather fronts are forecast to hit Taiwan this week, resulting in rain across the nation in the coming days, the Central Weather Administration said yesterday, as it also warned residents in mountainous regions to be wary of landslides and rockfalls. As the first front approached, sporadic rainfall began in central and northern parts of Taiwan yesterday, the agency said, adding that rain is forecast to intensify in those regions today, while brief showers would also affect other parts of the nation. A second weather system is forecast to arrive on Thursday, bringing additional rain to the whole nation until Sunday, it
CONDITIONAL: The PRC imposes secret requirements that the funding it provides cannot be spent in states with diplomatic relations with Taiwan, Emma Reilly said China has been bribing UN officials to obtain “special benefits” and to block funding from countries that have diplomatic ties with Taiwan, a former UN employee told the British House of Commons on Tuesday. At a House of Commons Foreign Affairs Committee hearing into “international relations within the multilateral system,” former Office of the UN High Commissioner for Human Rights (OHCHR) employee Emma Reilly said in a written statement that “Beijing paid bribes to the two successive Presidents of the [UN] General Assembly” during the two-year negotiation of the Sustainable Development Goals. Another way China exercises influence within the UN Secretariat is
LANDSLIDES POSSIBLE: The agency advised the public to avoid visiting mountainous regions due to more expected aftershocks and rainfall from a series of weather fronts A series of earthquakes over the past few days were likely aftershocks of the April 3 earthquake in Hualien County, with further aftershocks to be expected for up to a year, the Central Weather Administration (CWA) said yesterday. Based on the nation’s experience after the quake on Sept. 21, 1999, more aftershocks are possible over the next six months to a year, the agency said. A total of 103 earthquakes of magnitude 4 on the local magnitude scale or higher hit Hualien County from 5:08pm on Monday to 10:27am yesterday, with 27 of them exceeding magnitude 5. They included two, of magnitude
Taiwan’s first drag queen to compete on the internationally acclaimed RuPaul’s Drag Race, Nymphia Wind (妮妃雅), was on Friday crowned the “Next Drag Superstar.” Dressed in a sparkling banana dress, Nymphia Wind swept onto the stage for the final, and stole the show. “Taiwan this is for you,” she said right after show host RuPaul announced her as the winner. “To those who feel like they don’t belong, just remember to live fearlessly and to live their truth,” she said on stage. One of the frontrunners for the past 15 episodes, the 28-year-old breezed through to the final after weeks of showcasing her unique