By Jerry W. Jackson, Sentinel Staff Writer

The nation's insurance industry has weathered costly Gulf Coast hurricanes in recent years, but it faces more losses and internal competition, with catastrophe claims possibly doubling every decade, a leading industry executive said Monday during a conference near Orlando.

Insurance companies must consider the risk of another Hurricane Katrina or Hurricane Andrew hitting coastal regions that have continued to add businesses and homes in recent years, said Frank Coyne, chairman and chief executive officer of Insurance Services Office Inc., an industry-backed risk-information company based in Jersey City, N.J.

"States exposed to hurricanes are expected to continue to grow," Coyne said, with $7.2 trillion in insured coastal property already at risk. Florida accounts for about $1.9 trillion of that, or 27 percent.

This year's lull in hurricane activity has helped the industry, though. ISO recently estimated that third-quarter catastrophe claims will be the third lowest for that quarter in the past decade. Claims are expected to total about $971 million, down from a record-high $48 billion for the same period last year.

Terrorism, avian flu and even advances in technology also pose multibillion-dollar insurance threats that are difficult to quantify, Coyne said during the ISO Tech 2006 conference at the Gaylord Palms Resort & Convention Center.

The explosive growth of nanotechnology research and genetically modified foods, for example, could have unintended health consequences, he warned, and if they prove harmful, "lawsuits will fly."

But the insurance industry overall is healthy, with record surpluses, Coyne said, partly because the financial risk is increasingly spread globally. At the same time, there are steps the industry can take to trim some of the billions of dollars in lost revenue from claim fraud and pricing errors, he said.

"Premium leakage" -- human errors and technical problems that understate policies' correct renewal premiums each year -- costs personal-auto insurers alone about $16 billion a year, he said, while claim fraud adds about 10 percent to their losses. Improved computer models, data mining, "pattern recognition" and other advanced techniques can help reduce error rates and fraud, Coyne said.

Companies that fail to keep pace with the changing technology and challenges, he said, will lose out to more nimble competitors.

The ISO Tech 2006 conference, with about 800 attendees from throughout the country, began Sunday and concludes today at the Gaylord Palms in Kissimmee.

The conference, featuring information booths from companies specializing in software, services and technology for the insurance industry, is open only to industry professionals.