My readings into the y2k situation has revealed that 46 or 48 states have passed legislation giving themselves immunity from liability regarding y2k related incidents. I have also read that these same states have granted insurance companies immunity from liability regarding y2k damages because y2k is not an act of God or an accident. People with computerized systems should reasonably have known about the situation and should have prepared. I have also read that y2k clauses in business polcies have already appeared in new polcies. (Errors or ommitions policies for instance) Now for the big one: If Lloyds of London is also issuing y2k clauses. Will airplanes fly? Will freighters and tankers sail without insurance? Will hospitals treat patients? I have read this about Lloyds, but cannot find the url. Does anyone know? Can anyone support or refute what I have said? How does this effect us little people?

-- Bill Solorzano (notaclue@webtv.net), September 28, 1998

Answers

hi, Bill,

I think you may be right about insurance companies stepping in. A year ago I asked my insurance agent about y2k. "Not a Problem." Last week I got a notice that my small business policy would be issued a rider excluding y2k claims.

Will airlines/shipping companies/trucking companies/railroads be exempt? Nah, just larger and thus able to absorb a lawsuit or two.

Will planes fly or ship sail without insurance? Who knows? My best guess is that everyone will be very cautious. As in, "OK, that flight got through OK, let's send another one." Shutdown? I don't think so. Slowdown? Yep, that's what I expect.

-- rocky knolls (rknolls@hotmail.com), September 28, 1998.

"Thousands of newspaper column inches have been devoted to the threat posed by antiquated computer software that is incapable of dealing with more than a two-digit annual date change. Concrete solutions to the problem have been harder to come by.

That may be changing. Lloyds underwriters led by Brockbank syndicate 861 are now offering major corporations substantial insurance coverage against the business interruption and third-party risks arising from software failures in the first days of the new millennium. The coverage offers at least $200 million of protection against risks that fail to be eliminated by a detailed risk management audit....

Miriam Goddard, underwriter for syndicate 861, says that the best endeavors of the company and its insurers cannot preclude the possibility of heavy  and potentially crippling  losses. 'Millions of lines of code need to be adjusted and the company will need to be able to interact smoothly with vendors and suppliers. The biggest risk is that the company will be unable to function.'

Third-party risks are also very considerable, according to Goddard. 'Corporate America should perhaps start to circle the wagons. The plaintiffs bar is already showing real interest,' she says."

This was written in October 1997!

http://w ww.lloydsamerica.com/library/atlloyds2.3.shtml

-- John Howard (Greenville, NC) (pcdir@prodigy.net), September 28, 1998.