Is there anyone that remembers all the insurance insolvancies in CA not that long ago? They need a study to determine the cause? It’s a simple answer….Greed. The focus was on collecting premium dollars, not ensuring company solvancy. Company execs got paid big money based on production, then their companies went bankrupt because their premiums were inadequate for the losses. The State and taxpayers were then stuck with the bill.
California is so eager for lower wc rates that these same company execs were allowed to start up new carriers and start the process all over again. Check back in 10 years and see if they are still in business.
Sure, removing mimimum capital requirements will bring smaller carriers into the market and lower rates. Then, when the tail catches up with them, they will go bankrupt.
Low rates are important, but not at the expense of carrier solvency. The State should be regulating the market to ensure carrier solvancy. You either pay now, or pay later. These new law changes do nothing but defer costs down the road.
If the legislative changes have saved 14 billion in the CA work comp system, why did Gov sign new legislation ? Also, why did State Fund drop from being independently rated like all the other carriers?
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Is there anyone that remembers all the insurance insolvancies in CA not that long ago? They need a study to determine the cause? It’s a simple answer….Greed. The focus was on collecting premium dollars, not ensuring company solvancy. Company execs got paid big money based on production, then their companies went bankrupt because their premiums were inadequate for the losses. The State and taxpayers were then stuck with the bill.
California is so eager for lower wc rates that these same company execs were allowed to start up new carriers and start the process all over again. Check back in 10 years and see if they are still in business.
Sure, removing mimimum capital requirements will bring smaller carriers into the market and lower rates. Then, when the tail catches up with them, they will go bankrupt.
Low rates are important, but not at the expense of carrier solvency. The State should be regulating the market to ensure carrier solvancy. You either pay now, or pay later. These new law changes do nothing but defer costs down the road.
Good luck CA.
I remember, I worked for Cal Comp, Superior National and before that, Pacific Rim. I missed Paula!
Is that the next step? Like it wasn’t enough that WC rates have come down 60% over the last 4 years.
This is the first dumb WC change that I’ve seen Govenor Arnie make…
If the legislative changes have saved 14 billion in the CA work comp system, why did Gov sign new legislation ? Also, why did State Fund drop from being independently rated like all the other carriers?
Just wait till Hillary-care gets woven into the comp system. Good-bye America!!!
Sounds like Arnie’s spending too much time in Florida. He’s getting weird insurance ideas.