We recently attended a meeting, on behalf of various clients with representatives from the New York State Insurance Department to discuss issues arising out of the September 11, 2001 attack on the World Trade Center. Prior to the meeting, the Insurance Department polled the 20 largest insurers of the World Trade Center losses for purposes of developing an understanding of their positions regarding a number of issues we anticipate arising in connection with claims submitted by those damaged in the attack. We were advised that 15 of the 20 carriers responded.

While not all questions presented to the carriers were answered in a dispositive manner, the positions that we anticipate carriers taking on some issues merit discussion. The questions specifically presented to the carriers were as follows:

1. What is the appropriate period of "civil authority" coverage if "full access" (such as no deliveries or limited customer access) is denied? Can the industry agree on geographic areas and time periods to simplify and speed up claims processing?
   
   
2. Is dust and debris considered direct physical damage under standard property policies?
   
   
3. What is the appropriate measure of the time to repair when the government is restricting access to property to make repairs?
   
   
4. The overall clean-up at Ground Zero will take many months thereby directly affecting the property of insureds in the surrounding area. Can the length of time of the overall clean-up be considered part of the restoration period for business interruption claims? Air testing.
   
   
5. Is the testing of air quality and structural soundness in order to hasten a building's reopening (and thereby minimize a loss) a covered extra expense?
   
   
6. Is the lack of utility service, including lack of phone service, covered by off premises power loss to an insured?

7. Will insurer's immediately pay a rent loss for civil authority as soon as the number of days (or the maximum covered period) is determined in order to allow a business to meet its ongoing obligations?
   
   
8. Does the industry have criteria regarding claim advances or partial settlements in order to help businesses meet their obligations?
   
   
9. How long should it take for a company to actually pay a claim once a proof of loss or partial proiof is submitted?
   
   
10. If a business does not have access to its records because they were either destroyed in the disaster or access to their premises is not allowed, what can be done to facilitate an advance payment?
    
    
11. To what extent will "loss of market" (i.e. customers) due to the immediate loss of more than 100,000 jobs in the area and inability of customers outside the area to gain access, influence the amount and length of business interruption insurance?

While we were pleased by the reponses to some of the questions, I took exception to the positions taken on others and voiced my concerns at the meeting.

Two questions remain unasked an unresolved, namely:

1. the applicability of the pollution exclusion as it pertains to asbestos carried within dust that infiltrated various premises in the vicinity of the World Trade Center, and
   
   
2. coverage for loss of rent claims as a result of tenants breaking their leases for space that is arguably habitable.

If you have any questions, feel free to call or if you have had any experiences with any carriers as a result of the September 11, 2001 attack vis-a-vis any of these positions, I would be interested in hearing from you.