Friday, July 7, 2006

6 WTC Insurers Won't Cough Up $1.5 billion


The six insurers of the World Trade Center have not paid landlord Larry Silverstein $1.5 billion, even five years after the attacks. Senator Charles Schumer (D-NY) wrote a letter of complaint to former Senate campaign opponent and current Insurance Department Superintendent Howard Mills.

According to the The New York Daily News:

The state insurance Department should launch an investigation into six insurance companies that are seeking to "wiggle out" of paying $1.5 billon to rebuild the World Trade Center site, Sen. Chuck Schumer demanded yesterday.

"Without the prompt payment in full ... both the pace and scope of the rebuilding of the World Trade Center site are in jeopardy. And that is not an acceptable outcome," Schumer wrote in a letter to Insurance Department Superintendent Howard Mills.

Schumer (D-N.Y.) asked Mills to employ the "full capacity" of the Insurance Department to take "immediate, aggressive, decisive action" against these "unjustifiably intransigent" firms.

"We cannot allow these companies to use business-as-usual tactics to avoid paying what they owe," Schumer said. "Too much is on the line here."

Asked about Schumer's demands, Insurance Department spokesman Michael Barry said the department "has been looking into this matter to ensure nothing stands in the way of the rebuilding of the World Trade Center site."Mills unsuccessfully attempted to unseat Schumer in 2004.

The Port Authority, which owns the WTC site, and Ground Zero developer Larry Silverstein filed suit against the insurance companies last week. They accused the firms of using an April agreement that transferred rebuilding responsibilities from Silverstein to the bistate agency as a pretext for not paying the claims.

Officials at the insurance firms have declined comment.

Critical thinking time. Questions. That's all this is. Here goes:

Why won't the 6 companies cough up? Is it just pure greed? I don't think so. This refusal to pay is the opposite of what they should do if they were merely looking out for their business interests. All their credibility is going out the window. This means far fewer customers for them.

So why won't they cough up? Do they have a legal basis? I don't think so. The Port Authority and Larry Silverstein "accused the firms of using an April agreement that transferred rebuilding responsibilities from Silverstein to the bistate agency as a pretext for not paying the claims." I'm no lawyer, but that sounds like a pretty weak defense on the part of the insurers.

Maybe they have a moral basis for not paying. Insurance companies often refuse to pay, and rightly so, whenever there is fraud. For example, if a landlord sets fire to his own property, and the insurance company finds out, the landlord is in trouble.

Was there some form of fraud? Did Silverstein "set fire" to the WTC? After all, it was he who gave the order to "pull" Building 7 at 5:20 p.m. on September 11, 2001. He even admitted to it on PBS (24-second clip). It takes weeks of planning to pull off a controlled demolition. He couldn't have decided to pull the building and then rigged it all in one day. The building collapsed beautifully, with no casualties.

Here is Silverstein on Charlie Rose explaining that he would need "deep psychoanalysis" to describe why he would want to buy the entirety of the World Trade Center in the summer of 2001 and immediately take out the biggest insurance policy in the history of the universe ($3.5 billion, plus a couple more billion from the taxpayers in the form of Liberty Bonds.) (Note: watch Silverstein talk but with the volume muted. It's fascinating. The cognitive dissonance is uncontainable: he twitches and grimaces and looks like he's posessed. I swear, try it. You'll be shocked. Every few seconds, for a quarter of a second, his face contorts into some new aspect of hostility.)

So I ask you again. Why won't the insurers pay up? Are they really so stupid? Perhaps you're wondering why I'm so suspicious. Perhaps you're thinking, "Coincidences happen all the time, so quit jumping to conclusions." Well this isn't all I know. It's not even the tip of an iceberg.


The 7 insurers have already paid $2.4 billion out of the $4.6 billion they owe. In addition, the Liberty Development Corporation will approve $2.5 billion worth of Liberty Bonds in the coming weeks to help Silverstein rebuild Towers 2, 3, and 4.

I think the main crux of my point is that this insurance debacle is an opportunity to find out what the insurers know about the 9/11 attacks. Since they have a lot at stake, perhaps they are dragging their feet to buy more time as they conduct a fraud investigation of their own. It's just a hypothesis.