California Insurance Commissioner John Garamendi released a statement saying, “the more money these companies keep from your premiums, the less they pay out in claims…If my understanding of these results is confirmed …I will be ordering a significant number of insurers to reduce their rates.”
The important factor for measuring whether a company has excess profits is their “loss ratio.” Garameni explains loss ratio as “what an insurer spends to pay the claims of its customers, expressed as a percentage of its premiums…the bottom line is that lower loss ratios translates to higher profits.” A startling but not surprising finding consisted of “companies eagerly filing applications to increase rates during periods of higher losses with no corresponding race to reduce rates as loss ratios tumbled.”
This study is a sobering exposure of greed in all its glory. I am encouraged by the vigilance of Garamendi to take on the insurance companies despite their smear campaign and intimidation tactics against him.
» CA Ins. Commissioner Approves 18% Decrease In Homeowner & Renter Premiums from TheInsurancePolicy
The California Insurance Commissioner John Garamendi on Thursday approved an 18% decrease in homeowner and renter premium rates by the Hartford Company according to a press release on www.insurance.ca.gov. This marks the start of what appears to ... [Read More]
Tracked on: June 30, 2006 12:21 PM | Permalink to Trackback