New Watchdog Group Barks at Industry
Insurance Chronicle
August 5, 2002

A new watchdog group, formed by the convergence of more than 60 consumer advocacy and public interest organizations, is singing the choruses of industry wrongdoing and the need for increased regulation by the state insurance commissioners. …In a letter addressed to the 50 state insurance commissioners and the commissioner for the District of Columbia, Americans for Insurance Reform said it is, "appalled that insurers - whose own actions have created a 'crisis' in insurance affordability and availability for everyone from doctors and trauma centers to homeowners and motorists - are blaming others for their own mismanagement."

The group argues that, rather than the list of issues the industry cites, the increases in premium rates currently going on in the industry are the result of a business cycle pushed to extremes by corporate mismanagement or wrongdoing. "In view of the excessive rate increases, price gouging and tight underwriting that have hit certain lines of insurance this year, including the homeowners and medical malpractice lines, and recent reports about the questionable business and accounting practices of some insurers that are intensifying the impact of the economic cycle of the insurance industry, Americans for Insurance Reform believes it is imperative that insurance regulators take immediate steps to impose a new regime of corporate responsibility and accountability on this industry whose business practices are wreaking havoc on the American economy," the group said in its letter.

For a copy of the complete article, contact AIR.