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Trent Lott Shall Rise Again - A Problem for Insurers?

On November 15, Lott was elected to the post of minority whip, the Republican Party's second-highest Senate post, in a 25-24 vote over Sen....
November 22, 2006

By one vote, former Senate Majority Leader Trent Lott (R-Miss.) has risen from the political wilderness.

On November 15, Lott was elected to the post of minority whip, the Republican Party's second-highest Senate post, in a 25-24 vote over Sen. Lamar Alexander (R-Tenn.). Lott's return to the leadership ranks as one of the more impressive political comebacks of recent times. At a 100th birthday party for Sen. Strom Thurmond (R-S.C.) in 2002, Lott said the nation "wouldn't have had all these problems" if Thurmond had been elected president in 1948. Thurmond had run on a segregationist platform. Lott said he simply was flattering an old man. But Bush administration supporters and other Republicans helped engineer his ouster.

Lott's unexpected political resurrection is causing concern among insurance industry lobbyists. He is currently engaged in a legal battle with his home insurance carrier, State Farm.  Lott is suing State Farm over the insurer's decision to declare some of the damage from his house on the Mississippi Gulf Coast as partly flood-related and therefore not covered by his insurance.

Since the denial of his claim, Lott has been on the warpath against the insurance industry. He recently inserted a provision in an appropriations bill requiring the Department of Homeland Security to investigate insurers' handling of Hurricane Katrina claims. He has vowed to introduce legislation in the next Congress that will repeal the industry's limited antitrust exemption under the McCarran-Ferguson Act. And he proposed a bill he called the "Honesty is the Best Insurance Policy Act," which would require insurance companies to state clearly on their policies' front page what their policies don't cover.

One unidentified industry lobbyist told the National Underwriter that Lott is taking the same approach articulated by Rep. Gene Taylor (D-Miss.), another congressman suing the industry as a result of Hurricane Katrina. Regarding Lott and the industry, the lobbyist said, "He hates us, State Farm most of all."

Sen. Lott Election Brings Fear to P/C Sector (National Underwriter 11/16/06)