Call to action: Mergers, catastrophes, new laws and a Supreme Court ruling in 2003 shape the insurance landscape for 2004.

Although the issues have evolved from years past, 2003 was a time of action on several fronts for the insurance industry. Market demands and the need for capital strength and diverse distribution were some of the drivers that forged mergers and announcements of major mergers, including Manulife and John Hancock, Well-Point and Anthem, and Travelers and St. Paul. Weather patterns in the making for months or years erupted in a plethora of small-catastrophe winter storms, windstorms and hurricanes, and a succession of huge punitive-damage awards inspired the U.S. Supreme Court to say, "no more." The ongoing debate over credit-based insurance scoring was resolved in some states with the adoption of the National Conference of Insurance Legislators' model law, California took a stab at solving its long-standing workers' compensation problems by passing a $5 billion reform package, and Congress passed the most sweeping revision of the Medicare program in its 38-year history.

In a few cases, nonaction became the news that will influence insurers most in the coming year. After years of successful conversion by nonprofit Blue Cross and Blue Shield plans, a few who tried to become for-profit companies found it wasn't so easy in 2003. Despite strong protests by health-care providers, federal and state attempts to pass legislation to help control the cost of medical-liability insurance fell short, and as insurers increased reserves to cover asbestos claims, Senate negotiation about reform legislation trailed off.