For the Record.(Statistical Data Included)

MARRIOTT'S DAVENPORT RETIRES Arnold Davenport, a former Business Insurance Risk Manager of the Year, is retiring after 23 years at Marriott International Inc. Bradley R. Wood, who is vp-risk management for the Washington-based company, succeeds Mr. Davenport. Mr. Davenport, who retires June 30 as senior vp-risk management, said he plans to "pursue a personal life for a change" and will not become a consultant or start a business. He is moving to an island home on the St. Lawrence River in Canada. Mr. Davenport was named BI's Risk Manager of the Year in 1991. He was Marriott first risk manager, having joined the company in 1977 as director of casualty claims.

MANAGED CARE SUITS FILED Six managed care companies are accused of defrauding their members in lawsuits filed late last month in federal court in Miami. The suits, filed by attorneys representing members of the plans, charge that the insurers failed to disclose to members that doctors were offered incentives to deny care and limit hospital admissions. Plaintiffs charge that the plans violated federal racketeering laws by defrauding members. Named in the suits are Aetna U.S. Healthcare, CIGNA HealthCare Inc., Foundation Health Systems Inc., PacifiCare Health Systems Inc., Prudential Health Care and United Healthcare Corp. An Aetna spokesman said that the plaintiffs are "stretching legal theories that don't exist." Attorneys may seek to have the suits against the insurers consolidated, along with a similar suit against Humana Inc. filed earlier, into a single case.

PENSION SURVEY A significant proportion of employees either have Internet access to their pension plans from home or want such access, according to a survey sponsored by CIGNA Retirement & Investment Services. Of employees that have Internet access at home, 35% can gain access to their retirement information online, the survey said. Of those who have Internet access but can't reach their pension information online, 38% want such access, the survey said. The greatest interest in receiving pension information through the Internet was expressed by employees aged 18 to 24, of which 38% wanted online access. That compares with 35% of employees aged 35 to 49 who wanted the access; 32% aged 25 to 34; 29% aged 50 to 64; and 28% over age 65. The survey of 1,013 employees nationwide was conducted in June for CIGNA by Bruskin Audits & Surveys Worldwide.

P/C NET INCOME DOWN A variety of factors contributed to a decline of about 28% in the property/casualty insurance industry's 1999 net income, according to a study released last week by the Insurance Services Office Inc. According to the ISO, the industry's net aftertax income fell to $22.17 billion last year, compared $30.77 billion in 1998. The ISO report cited increased underwriting losses, lower investment income and realized capital gains and very sluggish premium growth as reasons for the drop. Insurers' underwriting los-ses grew by more than 39% to $23.39 billion last year compared to 1998, while net investment income fell 3.3% to $38.61 billion in 1999.

STATE SUES GUNMAKERS New York has become the first state to sue gunmakers. In a suit filed in Manhattan last week, the state said it seeks to alter the way that gun manufacturers and wholesalers conduct business. The lawsuit, which does not seek monetary damages but instead aims to change gun industry practices, charges eight gunmakers and eight wholesalers with contributing to a public nuisance by manufacturing and distributing guns they know will end up in the hands of criminals. Specifically, the suit seeks to require gunmakers to add safety features to handguns. In addition, it seeks to prevent sales to those retailers that have track records of selling to criminals and to create a court-appointed monitor of the system by which guns are distributed. The illegal possession or distribution of handguns is a public nuisance under New York law. Such an approach makes this lawsuit a greater threat to the gun industry than the numerous suits filed by cities, according to the New York attorney general's office. Those lawsuits assert that gunmakers have been negligent, which is a harder standard to prove.

FEMA EVALUATES EROSION COSTS Exposure to erosion losses should be taken into account when National Flood Insurance Program rates are set, according to a report issued last week by the Federal Emergency Management Agency. Erosion along U.S. coastlines could cause an estimated $500 million in losses annually if current population and erosion trends continue, said FEMA Director James Lee Witt as he released FEMA's "Evaluation of Erosion Hazards" at a Washington press conference. Roughly 25% of the structures currently within 500 feet of Atlantic, Gulf Coast, Pacific and Great Lakes shorelines will be lost to erosion within the next 60 years, he said. As a result, the report recommends that Congress allow FEMA to account for the cost of erosion when setting NFIP rates, said Mr. Witt. Current law forbids FEMA from considering erosion risks when determining rates. The report also recommends that Congress authorize FEMA to prepare erosion maps similar to the flood plain maps the agency already charts. Such maps would allow municipalities and developers to choose less erosion-prone areas on which to build.

TOBACCO COMPANIES WIN CASE Smoking was not a substantial cause of a longtime smoker's lung cancer, a New York state court jury found last week in a surprise legal victory for the tobacco industry. Other factors, such as exposure to asbestos, carcinogenic plastics and fumes -- and not 30 years of smoking -- caused Clyde Anderson's cancer, the jury ruled, according to attorneys in the case. The decision "shows that these cases are truly individual, and you cannot determine liability without looking at the individual facts of each case," said Michael York, a lawyer representing Philip Morris Cos. Inc. The decision by the Kings County Supreme Court also supports tobacco companies' contention that smokers are aware of the inherent risks of smoking, said Stephen J. Kaczynski, a lawyer at Jones, Day, Reavis & Pogue in New York who represented R.J. Reynolds Tobacco Holdings Inc., which was the lead defendant in the case.

BRIEFLY NOTED The Senate Judiciary Committee last week voted 11-7 in favor of the Class Action Fairness Act, which would permit the removal of certain interstate class-action suits from state to federal courts. The bill's supporters, including employer groups, say it will greatly reduce so-called forum shopping, in which plaintiffs attorneys attempt to file national class-action suits in the most plaintiff-friendly state courts. . . .Fitch IBCA has upgraded its financial strength rating of the Insurance Co. of North America intercompany pool to A+, with a stable outlook. The INA pool represents the bulk of Bermuda-based ACE Ltd.'s U.S. operations. Fitch said the upgrade reflects improved underwriting results. . . .A.M. Best Co. has upgraded its financial strength rating of Farmers Insurance Group to A+ from A. Best's upgrade reflects Farmers' improved performance and strengthened capitalization as part of the Zurich Financial Services Group.