The insurance industry should lose it’s anti-trust exemption. What other industry allows the sharing of cost and pricing data? It’s time for ISO and the other rating agencies to go. If a company can’t figure out what to charge based on it’s assessment of the market, it shouldn’t be in this business.
Did you note it is the smaller companies that are most opposed to the repeal? The reasons are obvious: they have less staff to process the data, and less experience of thier own to work from.
How would knocking out the smaller firms (and adding another barrier to new entrants) increase competition?
Law of Large Numbers…smaller insurers need to be able to pool their data to try to compete with the larger insurers. Take that away and you are taking away choices for the consumers.
In Colorado, where the market sets the rate, we have hundreds of authorized P & C writers (71 write 98% of the auto business, 126 write over $.5MM in premium)and by letting them use a common database to calculate rates saves millions it would take to duplicate the loss history. Start-up company would prohibitive barriers to entry without access to the database. I see no evidence that copetition is hindered by the anti-trust exemption. I think consumers benefit from the real cost savings realized from using common data that more accurately reflects the expected losses.
Let’s remove the anti-trust exemption and cause some chaos. Anyone remember the AT&T breakup and the decrease in services and increase in rates (still escalating) that has occurred? There was a reason for McCarran-Ferguson, and that was to help level the playing field and make insurance more affodable to the consumer. Repeal will do nothing but force smaller carriers, whose experience will not support a rating structure (compared to the industry as a whole) out of business. If we repeal McCarron-Ferguson, we’ll also have to do away with state approval of rates. The companies left will have to be free to charge whatever they feel is necessary (you can’t have it both ways).
Hmmmm, let’s see, repeal McCarran Ferguson, force smaller carriers out of business and let those remaining set their own pricing. Does this seem like a scenario that will benefit the consumer? When you have to pay a 30% rate ($3,000 for $10,000 coverage) for a basic fire policy, or $6,000 per vehicle for your fleet, don’t blame the industry. Put the blame where it belongs, on the mis-guided who want to kill the insurance industry that really does work as structured.
This is a non issue. The large companies do not use the rating bureaus and rely on own data – control what 70% of market share. And, small carriers (over 1,000) have 30% of market share and they think that they need an anti – trust exemption?
This is a state / political issue. the states will get their premium taxes, but will not have their insurance regulations to exact concessions from companies and agents, and the agent associations will have less impact. Hummm… this is an employement bill not consumer concern.
We want less regulation, but 51 departments doing the same thing; we want to protect the consumer, but make the product less comprehensible and less available; we want to limit or constrain the big guys, yet let only the guys with resourses to use the system – looks like the new energy policy from Washington. GO FOR IT!
The insurance industry should lose it’s anti-trust exemption. What other industry allows the sharing of cost and pricing data? It’s time for ISO and the other rating agencies to go. If a company can’t figure out what to charge based on it’s assessment of the market, it shouldn’t be in this business.
Did you note it is the smaller companies that are most opposed to the repeal? The reasons are obvious: they have less staff to process the data, and less experience of thier own to work from.
How would knocking out the smaller firms (and adding another barrier to new entrants) increase competition?
Law of Large Numbers…smaller insurers need to be able to pool their data to try to compete with the larger insurers. Take that away and you are taking away choices for the consumers.
In Colorado, where the market sets the rate, we have hundreds of authorized P & C writers (71 write 98% of the auto business, 126 write over $.5MM in premium)and by letting them use a common database to calculate rates saves millions it would take to duplicate the loss history. Start-up company would prohibitive barriers to entry without access to the database. I see no evidence that copetition is hindered by the anti-trust exemption. I think consumers benefit from the real cost savings realized from using common data that more accurately reflects the expected losses.
Let’s remove the anti-trust exemption and cause some chaos. Anyone remember the AT&T breakup and the decrease in services and increase in rates (still escalating) that has occurred? There was a reason for McCarran-Ferguson, and that was to help level the playing field and make insurance more affodable to the consumer. Repeal will do nothing but force smaller carriers, whose experience will not support a rating structure (compared to the industry as a whole) out of business. If we repeal McCarron-Ferguson, we’ll also have to do away with state approval of rates. The companies left will have to be free to charge whatever they feel is necessary (you can’t have it both ways).
Hmmmm, let’s see, repeal McCarran Ferguson, force smaller carriers out of business and let those remaining set their own pricing. Does this seem like a scenario that will benefit the consumer? When you have to pay a 30% rate ($3,000 for $10,000 coverage) for a basic fire policy, or $6,000 per vehicle for your fleet, don’t blame the industry. Put the blame where it belongs, on the mis-guided who want to kill the insurance industry that really does work as structured.
This is a non issue. The large companies do not use the rating bureaus and rely on own data – control what 70% of market share. And, small carriers (over 1,000) have 30% of market share and they think that they need an anti – trust exemption?
This is a state / political issue. the states will get their premium taxes, but will not have their insurance regulations to exact concessions from companies and agents, and the agent associations will have less impact. Hummm… this is an employement bill not consumer concern.
We want less regulation, but 51 departments doing the same thing; we want to protect the consumer, but make the product less comprehensible and less available; we want to limit or constrain the big guys, yet let only the guys with resourses to use the system – looks like the new energy policy from Washington. GO FOR IT!
Well said, Ted. Lets fix what’s not broken.