The property/casualty industry faces a variety of short-, medium- and long-term challenges, said David Sampson, president of the Property Casualty Insurers Association of America, as he opened the organization's 2013 annual meeting in Boston on Monday.

One risk common to each time frame is the risk emanating from changing regulatory standards, Mr. Sampson said.

“What we must guard against are policies that work to hinder the viability of a competitive private insurance market, namely the regulatory overreach by state, federal and international officials and laws that undermine a P&C company's ability to operate on actuarially sound principles and that interfere with market dynamics,” he said.

Mr. Sampson said that while legislative efforts to alter how insurance companies underwrite risk and pay claims are perennial, such efforts tend to gain more traction in the wake of catastrophic events such as Superstorm Sandy.

“In the aftermath of Sandy, we continue to be up against a rising tide of legislative and regulatory proposals that would undermine insurance contract certainty by political fiat,” he said.

Much as new government regulations present risk to the industry, uncertainty surrounding existing government programs will also challenge insurers, Mr. Sampson said. As the reauthorization of the Terrorism Risk Insurance Act is debated in Washington, the doubt surrounding TRIA, which is authorized until the end of 2014, is beginning to impact the industry at the policy level, he said.

“Ratings agencies are contemplating the impact of what the failure to reauthorize TRIA would have on companies,” he said. “It is important that we address this quickly.”

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A similar dynamic is at play surrounding the National Flood Insurance Program, he said, adding that the passage of the Biggert-Waters Flood Insurance Reform Act of 2012 has yet to stabilize the program.

“Unfortunately, there have been so many implementation issues that it has become problematic for Write Your Own insurers as well as for consumers,” he said. “Insurers are also worried about reputational risk as this program rolls out in a haphazard and inefficient manner.”

Looking further out on the horizon, Mr. Sampson said that the insurance industry's regulatory and political issues are not limited to the U.S., citing global regulatory convergence as a primary long-term risk. He said the plans of the International Association of Insurance Supervisors to create a quantitative global insurance capital standard by 2016, at the behest of the Financial Stability Board, are a prime example of this trend.

“The FSB is clearly seeking to be the final arbiter of global financial service regulation,” Mr. Sampson said.

“While it may be years before capital standards are finalized and implemented, we must realize the very real threat of new layers of bank-centric, unnecessary regulation.”