The House Financial Services Capital Markets Subcommittee, chaired by Rep. Richard H. Baker (R-La.), Thursday held a hearing to discuss the influence of various state regulatory systems on the availability of personal lines insurance, such as auto and homeowners
“The availability and affordability of property/casualty insurance is a priority for insurers, public policy makers, and consumers,” said Carl Parks, senior vice president, government relations, National Association of Independent Insurers (NAII). “Today’s hearing provided an important opportunity for members of Congress to learn more about the business of insurance with witnesses offering a common message that open competition best serves consumers and the economy,” added Parks.
Discussion focused on what has worked, what has not, and how best to resolve availability problems consumers face in certain states. “All witnesses acknowledged the need for insurance reform but none supported federal legislative action as the best alternative,” said Catherine Willis, director of government relations, NAII. The subcommittee chairman clearly wants to assure these problems are addressed and by conducting this hearing opened the door for committee consideration of federal standards legislation.
The subcommittee approached the issue by examining four states with divergent regulatory structures and exploring the effects that those structures have on insurance availability.
Loss costs have risen considerably over the past couple of years. Most of these expenses are not directly within the control of insurance companies.
Sharp increases in the number of claims, escalating reinsurance costs, rising costs of home and automobile repair, the explosion of individual and class action lawsuits, the ever-increasing number of fraud claims all contribute to the situation.
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