May 9, 2008 - The New York Times reports today that the fortunes of American International Group, one of the world's biggest insurance companies, rise and fall on precise calculations of risk. Last quarter, those calculations went seriously awry.

The Times adds that, in the worst three months of the company's 89-year history, A.I.G. lost $7.81 billion, primarily from bad investments in complex financial instruments. The loss of $3.09 a share, reported after the market's close Thursday, was four times worse than Wall Street analysts had expected.

Best's Insurance News reported yesterday that neither impassioned pleas by coastal legislators nor a near-filibuster by Sen. Mary Landrieu, D-La., was able to save a proposal for the National Flood Insurance Program to begin writing windstorm coverage. Offered as an amendment to U.S. Senate legislation extending the 40-year-old program through 2013, the plan was turned back in a 73-19 vote.

Best's Insurance News reported yesterday that Munich Re Group said first-quarter profit fell 19.4%, a result the reinsurer calls "satisfactory" given investment losses comparable with its peers, unfavorable exchange rates and a softening market.

The Miami Herald reports today that the 13 insurers that took advantage of a low-cost loan program to pump up capital and write thousands of new policies are still sitting on millions of unused dollars. Eleven of the companies haven't been able to write all the policies the program required. Six companies are paying stiff interest penalties because they haven't written as many policies as promised.

Workers' compensation costs per claim in Louisiana were 28 percent higher than the median of 14 study states for a similar set of 2003/2006 claims, according to a new study by the Cambridge, Mass.-based Workers Compensation Research Institute (WCRI).