Act's Provisions Explained at Breakfast Seminar Hosted by
Hub International Limited Subsidiary, Kaye Insurance Associates
Hub International Limited (NYSE: HBG; TSX: HBG) announced today that the Terrorism Risk Insurance Act passed by both houses of Congress in the past week will likely be signed into law by as early as Tuesday of next week, voiding most existing terrorism exclusions on commercial lines insurance policies.
The announcement was made to more than 50 New York business leaders, who attended an educational breakfast sponsored today by Kaye Insurance Associates, a leading regional commercial insurance brokerage and subsidiary of Hub International. The purpose of the breakfast was to explain the intricacies of the Act and discuss possible consequences and timing. Bruce D. Guthart, Kaye Chairman and CEO and President of US Operations for Hub International, noted that: "While the crystal ball isn't completely clear in all respects, we certainly view passage of the act as a major plus for New York's business community. For instance, many real estate development projects that have been stalled because they were unable to get terrorism coverage will now be able to move forward because the government has provided a much-needed backstop for the property/casualty insurance industry."
Joining Guthart on the dais were Joel Wood, Senior Vice President of Government Affairs at the Council of Insurance Agents & Brokers, and Warren Azano, Vice President of Government Affairs of The Hartford Insurance Company.
Wood said that: "We at the Council do not know precisely in which way the marketplace will respond in coming weeks and months to the enactment of this historic legislation. We do know that the impact will be immediate upon President Bush's signature -- which could take place early next week -- insofar as terrorism exclusions will be voided pending the acceptance or rejection of consumers to an offer for the coverage. We know that the boundaries of risk for terrorism have now been largely defined for insurers, if only for a temporary time. Beyond that, we think that the marketplace response will be neither price-gouging nor a giveaway."
Participants praised Bush's devotion to the legislation and Congress' attention to such an important matter. "Ultimately, the Act will allow for business and economic recovery," said Guthart. "President Bush has been most attentive to these issues and we in the industry appreciate the time and effort that's gone into passing this legislation. Members of both houses should be lauded for their efforts."
Hub International has nine large "hub" brokerages, including Kaye, that have significant market presence in their geographic regions in the U.S. and Canada. Each hub provides insurance brokerage services and manages the various smaller Hub International brokerages in its territory. The hub brokerages are responsible for growth through sales, service and acquisitions, while the head office, located in Chicago, IL, coordinates access to the insurance market, expands the use of best practices among the hubs and manages the acquisition of additional hub operations.
A leading North American brokerage, Hub International has grown rapidly since its formation in 1998 through mergers, acquisitions and organic growth. It provides a broad array of property and casualty, life and health, employee benefits and investment and business risk management products and services through offices located in the United States and Canada. Hub International's strategy is to expand its market share in the highly fragmented North American insurance broker industry by acquiring quality brokerages in key geographic regions serving middle-market commercial businesses, to leverage its decentralized approach in order to differentiate its services and to capitalize on its scale to provide broad product offerings to its clients through multiple distribution channels. Additional information on Hub International can be found at its website: http://www.hubinternational.com.
This press release may contain forward-looking statements which reflect our current views with respect to future events and financial performance. These forward-looking statements relate, among other things, to our plans and objectives for future operations. These forward-looking statements are subject to uncertainties and other factors that could cause actual results to differ materially from such statements. These uncertainties and other factors include, but are not limited to, risks associated with implementing our business strategies, identifying and consummating acquisitions, integrating acquired brokerages, attaining greater market share, developing and implementing effective information technology systems, recruiting and retaining qualified employees, fluctuations in the premiums charged by insurance companies with a corresponding fluctuation in our premium-based revenue, any loss of services of key executives, industry consolidation, increased competition in the industry, fluctuations in the demand for insurance products and the passage of new legislation subjecting our business to regulation in jurisdictions where we operate. We caution readers not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Additional information regarding these risks and other factors that could cause Hub International's actual results to differ materially from our expectations is contained in the company's filings with the Securities and Exchange Commission. Except as otherwise required by federal securities laws, Hub International undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.