The

INSURANCE RECORD THE VOICE OF TEXAS INSURANCE Published Since 1934 • Dallas, Texas March 12, 2009 • Vol. 75 No. 6

Recovering Reinsurers Raise Rates —

What Nature Doesn’t Do To Us
Will Be Done By Our Fellow Man

LONDON—Reinsurers have begun 2009 determined to wrest back the initiative from a period of softening rates and savagely declining investment returns, according to Cooper Gay’s 2009 Reinsurance Market Review.

As a consequence, underwriters are increasingly being governed by the financiers dictating a return on capital and forcing through rate increases in many classes and areas.

The Review also found that 2008 was the third costliest year ever in terms of insured losses which, when combined with the turmoil on the world’s financial markets and the

growing cost of capital, has reversed the softening trend for reinsurance rates over recent years and seen a marked tightening of terms and conditions.

International Re Gets Stung Again

The economic downturn has also triggered an increase in property losses as businesses go into debt while, despite the Katrina induced determination for the world to no longer pay for American disasters, the international reinsurance community has again been stung by the U.S. This time however it’s the man made financial consequences of continued on page 4

TDI Keeping Tabs on

In This Issue

AIG Developments

DWC Announces enforcement Actions for Dec. & Jan.

SELLING STRATEGIES:

AUSTIN—The Texas Department of Insurance notes that it continues to closely monitor the financial status of American International Group Inc. (AIG) in light of recent national media reports. TDI is engaged in regular communication with AIG, the Federal Reserve Board, and other state insurance regulators about the most recent developments.

Wait A Minute

NAIC Releases Annual homeowners Insurance Report

USAA Sues for Trademark Infringement, False Advertising 11

“The Texas insurance companies remain well-capitalized,” Insurance Commissioner Mike Geeslin said. “TDI continues to be actively engaged in this situation so that policyholders are protected. There has been no bankruptcy filing by the parent company.