Linda: do you need to revert to name calling? What gives you the right to refer to the residents and the State of California as “the land of fruits and nuts.” You are a complete hypocrite.
There may not be policy non-renewals but who do you think is going to pay for the losses? It will be the policy holders. If the D.O.I. disallows rate increases to those carriers who lost a lot in this fire, it will be interesting to see what those carriers do. It is hard to believe that this magnitude catastrophe will not have financial reprecutions that will end up affecting the wallets of the insured’s. It is the quiet before the storm….I just feel it coming
If policyholders don’t “pay” for those losses through increased premiums, then who is supposed to? Insurers have yet to develop the technology needed to print real money in their basements.
I know I’m being simplistic, but that is what insurance is all about…it is a pass through mechanism. I pay premiums and they pay claims. (somebody else want to get into spreading risk and things like investment income??)
Are you kidding me? The 2003 fires resulted in rate increases, underwriting restrictions, and strict ISO enforcement in areas of heavy brush exposure. Our CEO says otherwise but we will take some form of punitive action on our policyholders, maybe not in the fire area, but you can bet the rest of the State will pay!
If some cluck from Ohio knows with certainty (per his/her post earlier this week) that the fires we experience are inevitable, how much moreso would the insurance companies who put their surplus on the line year after year? Early in my career a mentor advised that it is not the risk that is the worry, but rather can the risk can be rated. Unrateable risk is basically uninsureable; rateable risk, is. If there is an extensive amount of uninformed capital that has underwritten an extensive amount of under-rated risk in the fire areas, that capacity may be gone by next fire season. But the fault for the under-rated plans would have to be borne not only by the underwriter, but also in large part by the CA DOI who failed one of their prime directives: “…rates shall be adequate, not excessive, and not unfairly discriminative….”
The California DOI is just like any political body in this State, all they care about is how they look in front of the cameras. Everything the DOI does is pointed towards making themselves look good and the insurance industry look bad, who was the first to mention policy cancellations? The front page news this morning is AAA lowering auto rates, that is what the DOI likes, it makes them look like heros to the consumer. What a useless waste of the tax payers money!
hey, Papa John, what in the hell are all of these insurance companies doing insuring properties adjacent to a severe brush fire exposure? and where are the building codes to prevent this exposure?
I guess it doesn’t have to be a concern for a while now, ’cause it will take a couple of years for the brush to grow back. But unless somebody wakes up (in both the underwriting dept. and on the P&Z board) it will continue to happen.
but obviously there were a whole bunch of policies that should have been cancelled, because they had an uninsurable exposure to a known catastrophic event. where were the underwriters??????
Papa John: do you need to revert to name calling? What gives you the right to refer to the resident of another state as a “cluck”. Sounds to me like the guy was right on with his comments about fires being an annual event in the land of fruits and nuts. As for the other comments about the acceptability of a risk so long as rates cover it…….that shows the short-sighted views of American business. Think of the positive impact on business and the economy if some of these losses were PREVENTED. There’s a novel idea. I see the fact are already coming out about how CA mishandled the early response. Dozens of firefighting planes were grounded because of bureaucratic red tape requiring “spotters” to accompany pilots. Nice job folks.
I thought that these losses will get paid out of this year’s premiums, applied to this calendar year. In that sense, the hit is on the company for one year and the profit for this year will be be lower than expectations. But before rates can increase, companies will need to justify the increases with actuarial support, showing a trend that could affect the company’s solvency over time, not just taking a hit on this year’s profit. If a rate increase follows, it won’t happen in a vacuum; there will be public hearings before a committee and everyone will know about it. If it is a once time occurrence, I can’t see how it could be automatic….
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Linda: do you need to revert to name calling? What gives you the right to refer to the residents and the State of California as “the land of fruits and nuts.” You are a complete hypocrite.
There may not be policy non-renewals but who do you think is going to pay for the losses? It will be the policy holders. If the D.O.I. disallows rate increases to those carriers who lost a lot in this fire, it will be interesting to see what those carriers do. It is hard to believe that this magnitude catastrophe will not have financial reprecutions that will end up affecting the wallets of the insured’s. It is the quiet before the storm….I just feel it coming
If policyholders don’t “pay” for those losses through increased premiums, then who is supposed to? Insurers have yet to develop the technology needed to print real money in their basements.
I know I’m being simplistic, but that is what insurance is all about…it is a pass through mechanism. I pay premiums and they pay claims. (somebody else want to get into spreading risk and things like investment income??)
Are you kidding me? The 2003 fires resulted in rate increases, underwriting restrictions, and strict ISO enforcement in areas of heavy brush exposure. Our CEO says otherwise but we will take some form of punitive action on our policyholders, maybe not in the fire area, but you can bet the rest of the State will pay!
If some cluck from Ohio knows with certainty (per his/her post earlier this week) that the fires we experience are inevitable, how much moreso would the insurance companies who put their surplus on the line year after year? Early in my career a mentor advised that it is not the risk that is the worry, but rather can the risk can be rated. Unrateable risk is basically uninsureable; rateable risk, is. If there is an extensive amount of uninformed capital that has underwritten an extensive amount of under-rated risk in the fire areas, that capacity may be gone by next fire season. But the fault for the under-rated plans would have to be borne not only by the underwriter, but also in large part by the CA DOI who failed one of their prime directives: “…rates shall be adequate, not excessive, and not unfairly discriminative….”
The California DOI is just like any political body in this State, all they care about is how they look in front of the cameras. Everything the DOI does is pointed towards making themselves look good and the insurance industry look bad, who was the first to mention policy cancellations? The front page news this morning is AAA lowering auto rates, that is what the DOI likes, it makes them look like heros to the consumer. What a useless waste of the tax payers money!
hey, Papa John, what in the hell are all of these insurance companies doing insuring properties adjacent to a severe brush fire exposure? and where are the building codes to prevent this exposure?
I guess it doesn’t have to be a concern for a while now, ’cause it will take a couple of years for the brush to grow back. But unless somebody wakes up (in both the underwriting dept. and on the P&Z board) it will continue to happen.
but obviously there were a whole bunch of policies that should have been cancelled, because they had an uninsurable exposure to a known catastrophic event. where were the underwriters??????
Papa John: do you need to revert to name calling? What gives you the right to refer to the resident of another state as a “cluck”. Sounds to me like the guy was right on with his comments about fires being an annual event in the land of fruits and nuts. As for the other comments about the acceptability of a risk so long as rates cover it…….that shows the short-sighted views of American business. Think of the positive impact on business and the economy if some of these losses were PREVENTED. There’s a novel idea. I see the fact are already coming out about how CA mishandled the early response. Dozens of firefighting planes were grounded because of bureaucratic red tape requiring “spotters” to accompany pilots. Nice job folks.
I thought that these losses will get paid out of this year’s premiums, applied to this calendar year. In that sense, the hit is on the company for one year and the profit for this year will be be lower than expectations. But before rates can increase, companies will need to justify the increases with actuarial support, showing a trend that could affect the company’s solvency over time, not just taking a hit on this year’s profit. If a rate increase follows, it won’t happen in a vacuum; there will be public hearings before a committee and everyone will know about it. If it is a once time occurrence, I can’t see how it could be automatic….