Insurance companies profit via interest on on unpaid 9/11 claims

Bryan Virasami

Several insurance firms that have refused so far to make payments needed to rebuild the World Trade Center site should be slapped with hefty penalties, according to Rep. Anthony Weiner.

Weiner’s push for fines yesterday comes as the state Insurance Department is demanding answers from four insurance companies about their intention to pay out at least $1 billion in insurance funds over the Sept. 11 terrorist attacks.

Weiner (D-Forest Hills), standing outside Ground Zero, suggested that the interest racked up on the money held by the insurance companies, which he said was between $188 million and $390 million, should be seized by the state and turned over to the World Trade Center Memorial Fund. The congressman said the delay raises suspicion in his mind about the companies’ intentions.

“What makes it more troubling is that it’s clear what their motivation for not paying is - it’s greed with a capital G,” Weiner said. “While they’re refusing to pay for their insurance policy, they are investing that money, making by our estimate over $200 million in profit off the events of Sept. 11.”

Meanwhile, the superintendent of the state Insurance Department, Howard Mills, has asked the companies directly for answers, spokesman Michael Barry said yesterday.

“The superintendent has reached out to the CEOs of the companies that have not yet paid the claims and has discussed the situation,” Barry said. He said the companies have offered signs they’re not trying to dodge their responsibility.

“They all understand that the Pataki administration is very intent on seeing this come to a resolution very quickly,” he said.

Barry said the four companies yet to pay are Allianz, Gulf Insurance Co., Royal Indemnity and Travelers Indemnity Co. He said Zurich American and Employers Insurance Wausau have given commitments to satisfy payments. Attempts to reach the companies yesterday were not successful.

The companies that have delayed payment may have done so partly because of the controversy over who will rebuild Ground Zero, one government source said. It was only recently settled that the Port Authority will oversee some developments.

Weiner, however, questioned whether the delay would fatten the profits of the insurance companies. “If anyone should profit from this, it should not be the insurers; they should be paying stiff fines for every day that they delay,” Weiner said.

Barry declined to comment on Weiner’s request. Asked whether the insurers would come through eventually, Barry said it looks good. “The [insurers] have been very responsive to Superintendent Mills’ overtures to them and we’re optimistic it’s going to be resolved amicably,” Barry said.