By Shawn Zeller, CQ Staff

While the surprise resignation of Trent Lott created a big hole in the Senate GOP leadership, it also sparked much quiet rejoicing in the insurance world. That’s because ever since Hurricane Katrina in 2005, Lott — whose Mississippi home was destroyed in the storm — has become one of the most powerful legislators advocating repeal of the insurance industry’s longstanding antitrust exemption, on the grounds that it permitted companies to collude on the appraisal of damage claims.

But Washington being Washington, insurance industry advocates have expressed much of their relief about Lott’s unexpected departure in private; in public, they’ve issued statements that were perhaps gracious to a fault. “I believe he is committed to finding durable and principled solutions to the ongoing coastal property insurance challenges left by Katrina,” declared Marc Racicot, the former Republican national chairman and Montana governor who is now the president of the American Insurance Association.

This irenic mood was hardly the order of the day when insurance trade groups marshalled all their clout earlier this year to sideline the Lott bill, which also would have subjected the industry to new federal regulation. Racicot’s association joined with a broad coalition of industry groups to lobby against Lott’s measure — including the National Association of Mutual Insurance Companies, which launched its own war room devoted to the fight. The rhetoric, too, was bellicose: In March, when the Senate Judiciary Committee held a hearing on the bill, Racicot blasted the idea. “We strongly, strongly believe it would be harmful,” he said.

The industry push back has worked, for now. But insurers aren’t ready to gloat. After all, the bill’s other sponsors include Judiciary’s chairman, Patrick J. Leahy of Vermont; its top Republican, Arlen Specter of Pennsylvania; and Majority Leader Harry Reid of Nevada. Lott’s exit may be a relief, said one insurance lobbyist — who didn’t want to be quoted by name in deference to the departing senator — “but you still have three other very powerful senior members who are on the bill.”