WASHINGTON (AP) — The chairman of Lloyd’s, the world’s biggest insurance market, warned on Friday of $100 billion natural disasters in the United States and urged a “radical rethink” of public policy in response to global warming.At the same time, Lord Peter Levene said in a speech, the insurance industry plays a crucial role in the US economy and should be allowed continued operation without government intervention or controls.

“Is the United States a nation in denial?” Levene asked. “Two years after Katrina, and two years away from a national election, where’s the public debate on catastrophe trends?”

“We urgently need a radical rethink of public policy, and to build the facts into future planning,” he said.

Lloyd’s believes that a “megacatastrophe” in the United States, so massive it would wreak $100 billion in insured losses, is getting closer and “could hit almost anywhere on the Atlantic coast”, Levene told a gathering of the World Affairs Council of Washington.

While Lloyd’s is planning actively for such a disaster, Levene said: “I seriously question whether all policymakers, businesses and homeowners are doing so. Society must make some tough decisions and be prepared to change its behaviour.”

For example, he said, policymakers should consider adopting “radical” land use policies in areas potentially affected by hurricanes, floods and other disasters; government aid should not be used to encourage unsound building decisions; and building codes should be improved.

London-based Lloyd’s has a significant interest in the issue. Of all insurers, it was the biggest single payer of claims related to the September 11, 2001, terror attacks as well as to Hurricanes Katrina and Rita in late 2005, for which it is paying out $6 billion.

Similarly, Lloyd’s suffered billions of dollars in losses during the late 1980s and early 1990s from asbestos and pollution cases as well as earthquakes and hurricanes.

In a globalised industry, some 80 percent of the reinsurance purchased by US companies is from foreign insurers such as Lloyd’s. Reinsurance is back-up insurance sold by some insurance companies to other insurers to spread risk so that huge losses can be covered.

The 300-year-old Lloyd’s is renowned for covering merchant ships, the lives of Russian cosmonauts and the legs of 1940s pin-up Betty Grable. Its latest notable contract is a policy, reportedly worth $70 million, on British soccer star David Beckham.

Lloyd’s is a self-regulating market of corporate underwriters and thousands of wealthy individuals that make insurance transactions through managing agents and syndicates. The individuals from around the world, known as “Names,” include politicians, businessmen and philanthropists but gradually are being replaced by corporate capital.

In successful Lloyd’s syndicates, the Names earn annual returns; in troubled syndicates, they can lose all their investments and be liable for a share of the overall loss.

Levene, who was Lord Mayor of London in 1998-99 and also worked in the banking industry, said that Lloyd’s — looking ahead to the “next Katrina” — is investing in new scientific research in Britain and is discussing with US business executives the formation of a special task force to examine the risks of global climate change.

He criticised suggestions from some government officials for new taxes or controls on the US insurance industry.

“We believe that any attempt to stifle market forces would be pure populist demagogy and misguided public policy,” Levene said.

While the industry in the United States made record profits of some $60 billion to $70 billion last year, he said, over the past 30 years it has lost more than $400 billion from paying out claims.

Allstate Corp., one of the largest US insurance companies, last week said it was dropping more than 100,000 additional property insurance customers in Florida. After billions of dollars in losses from the 2005 hurricane season, the property and casualty insurer said it would need to shed hundreds of thousands of policies and has since shifted more than 200,000 to other insurance companies in the state.

On Monday, the Consumer Federation of America accused the biggest US insurance companies of charging homeowners and motorists more for coverage, while paying out less, at a time of record profits. The companies’ profits have surged in recent years, despite the billions in claims from Katrina and other storms, in part because they have shifted more costs to consumers, the group said.