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Technology Stocks : Y2K (Year 2000) Stocks: An Investment Discussion -- Ignore unavailable to you. Want to Upgrade?

To: bob who wrote (13235)	11/10/1998 10:28:00 AM
From: bob	Read Replies (1) \| Respond to of 13949

Insurance Companies are Failing to Protect Themselves From Year 2000 Claims BETHESDA, Md., Nov. 10 /PRNewswire/ -- With less than 14 months until the year 2000, insurance companies are continuing to write policies without adequately underwriting insureds' Year 2000 preparedness, says Andrew Pegalis, President of Next Millennium Consulting (NMC). NMC is the nation's first independent risk management consulting firm dedicated exclusively to providing comprehensive Y2K risk management services. "For every thousand policies issued in 1998," says Pegalis, "insurers collected no more than a handful of Y2K questionnaires. Many brokers effectively steered their clients away from Year 2000 questionnaires as insurers succumbed to competitive pressures. If insurance companies want to protect themselves against the expected litigation deluge, underwriting must improve before the 1999 policy renewals begin. "Insurers must improve and centralize underwriting practices and insist that clients, at the very least, complete Y2K questionnaires," explains Pegalis. "These questionnaires provide multiple benefits to carriers, not least of which is to gain an accurate depiction of the individual risk of the overall portfolio's exposure to Y2K." Pegalis pointed out that the keys to Year 2000 underwriting are disciplined insistence on completed Y2K questionnaires, underwriter training and centralized control over all Y2K efforts. Insurers also need to act immediately to shore up their procedures in another key area. The Year 2000 Information and Readiness Disclosure Act, signed into law by President Clinton last month, protects all companies that make certain Year 2000 disclosures. The Act makes no exception for Year 2000 insurance questionnaires and may prevent insurance companies from denying claims based on false or misleading Year 2000 information. This may be only one of several unintended implications of this controversial new Act. "With only a few minor policy modifications however, insurers can avoid this potentially devastating legal loophole," said Pegalis. "The first key deadline under the Act is December 3rd, 1998, and the insurance industry must not be caught by surprise." Next Millennium Consulting (NMC) utilizes multi-disciplined expertise and traditional risk management practices to create a single plan of action for businesses that encompasses all Y2K exposures. By offering a series of comprehensive services, NMC develops and implements a comprehensive enterprise risk management program for each of its clients. NMC is a member of the Information Technology Association of America's (ITAA) Y2K Task Force, and the ITAA Y2K Legal Group. Andrew M. Pegalis, Esq. is a member of the Society for Information Management's Year 2000 Working Group, the Maryland State Bar Association and the American Bar Association. He was a Risk Management Specialist for The Prudential Insurance Co. of America and worked for the Office of the U.S. Trade Representative in Geneva Switzerland. Before founding NMC, he was at Professional Risk Management Services in Arlington, VA. SOURCE Next Millennium Consulting