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OHIO TO BE AFFECTED BY EVOLVING "HARD MARKET" IN INSURANCE

 FAIRLAWN, Ohio, May 4 /PRNewswire/ -- Restrictions in the availability of property-casualty insurance, which led to boycott calls yesterday by consumer advocate Ralph Nader, foreshadow a developing nationwide shortage of coverage from which Ohio will not be immune, according to risk manager Todd Stein, president of The Brunswick Companies.
 The tremendous volume of property insurance claims being made to recover damages from recent storms in Florida, Louisiana and New England, as well as the expected claims to come from the World Trade Center bombing, have made it harder to obtain insurance coverage in those areas, explains Stein.
 "It's only a matter of time before Ohio companies begin to feel what is inevitably a supply-and-demand issue," forecasts Stein, whose company has a number of clients locally and in areas damaged by Hurricanes Andrew and 1989's Hugo. "As these large claims come to the major insurance underwriters, the amount of property insurance they're willing to carry will begin to drop, making it more difficult upon renewal to obtain the same levels of coverage for the same amount of money."
 Industry experts estimated that the World Trade Center bombing and the 1993 blizzard will produce property insurance claims of $510 million and $1.6 billion, respectively. That's on top of the $23 billion in catastrophe losses during 1992, of which $15.5 billion alone was due to Hurricane Andrew.
 Stein explains that losses of this magnitude will likely send the insurance industry into what analysts call a "hard market," or a period in which available capacity for property and business insurance coverage shrinks and prices rise. The way this affects a company, he says, is that while currently it may hold several million dollars of protection with one or two insurance underwriters, it may need to approach three to five carriers to obtain the same levels of protection during the coming year.
 "We've been in a soft market for several years now," says Stein, "as prices have been going down and capacity has increased. With good insurance management, a business owner during this time period could have purchased business interruption coverage and coverage fs its own claim hi story and finds, for example, that its claims for a particular division or for product liability coverage on Product Line X has been relatively low, they should consider self-insurance for these low-exposure areas as opposed to traditional coverage through an insurance carrier," he explains.
 -- Higher deductibles. Another option is for companies to assume more of the risk themselves by raising their deductibles for certain lines. An analysis of past coverage and claim histories will likely indicate which areas a company can afford to take on themselves, Stein said.
 For the long term, Stein points to adopting an overall risk management approach to insurance protection, as a way to aggressively manage coverage levels. "Professional risk managers take a more aggressive posture for companies than traditional insurance brokers who primarily bid out policies. A risk manager over time will improve coverage levels, reduce premiums and claims, and enhance a company's cash position to its advantage."
 The Brunswick Companies is a risk management firm that specializes in professional liability insurance, insurance underwriting, risk and claims management, workers compensation and financial consulting.
 -0- 5/4/93
 /CONTACT: Kelly Kleinschmidt of The Brunswick Companies, 216-864-8868; or Joel Goldstein of Goldstein Group Communications, Inc., 216-398-0030, for The Brunswick Companies/


CO: The Brunswick Companies ST: Ohio IN: INS SU:

KL -- CL009 -- 4319 05/04/93 12:16 EDT
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Publication:PR Newswire
Date:May 4, 1993
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