Report: Insurers Boost California Economy $29.4B

By | January 18, 2013

Insurers directly contributed $29.4 billion to California’s 2010 gross state product, or for 1.6 percent of the state’s GSP, according to the report issued on Friday by the Insurance Information Network of California.

The report shows property/casualty insurers provided 209,016 California jobs in 2011. At nearly 10 percent of the nation’s insurance workforce, California employs more insurance professionals than any other state, according to IINC. California insurance jobs accounted for $19.2 billion in compensation in 2010, the report shows.

But those figures don’t not reveal the indirect impact, according to IINC spokesman Pete Moraga.

“What this doesn’t include is the countless number of jobs and other industries that are impacted by insurers,” Moraga said, adding that auto repair shops, mechanics, attorneys, medical practices, home repair stores are among the myriad sectors boosted by insurance spending.

“Indirectly we support so many other forms of employment and businesses that it’s just too hard to measure,” he said.

Property/casualty claims payments in 2011 totaled $30.3 billion in California, the report shows.

“Every time a claim is paid, that goes into the economy, and that goes into the economy because insurers are paying for that car that is getting repaired,” he said.

Life insurance claims and benefits payouts in California totaled nearly $41.3 billion, while California collected $2.3 billion in premium taxes from insurers in 2011, according to the report.

One of the biggest impacts insurers had was in the automotive arena, the report shows. Californians insure substantially nearly 25 million cars, more than drivers in any other state.

“We are very car-centric,” Moraga said.

Homeowners insurance also makes a big impact on California, particularly following catastrophes, Moraga said.

“Seven of the 10 most costly U.S. earthquakes occurred in California. Seven of the 10 largest U.S. wildfires occurred in California,” Moraga said. “Some of the biggest disasters in the country have occurred in the state.”

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