Does Consumer Watchdog Want Admitted Insurers to Leave the State?

[marindependent]

Consumer Watchdog has continued to fight tooth and nail about State Farm's potential rate increase.

According to their own website "Consumer Watchdog is a nonprofit organization dedicated to providing an effective voice for taxpayers and consumers in an era when special interests dominate public discourse, government and politics." And they "deploy an in-house team of public interest lawyers, policy experts, strategists, and grassroots activists to expose, confront, and change corporate and political injustice every day, saving Americans billions of dollars and improving countless lives."

Again and Again they stand up and claim ""State Farm is trying to sidestep transparency by pushing for emergency increases without fully proving their necessity,""

They seem to not understand, in any capacity the problems with State Farm. Their California Unit is one rating step away from not being accepted by mortgage companies. They dont seem to read the news about the horrible California Wildfires!

Meanwhile the nonadmitted property policy count in this state continues to climb. Perhaps we have been looking at this all wrong. Judging by their actions - Is it Possible that Consumer Watchdog wants the Admitted insurers to leave the state?

What is the problem with letting State Farm determine their own rates?
What do you think?

 

[marindependent]

From Carrier Management:

"
"Consumer Watchdog's actuary reached completely unreasonable conclusions about the lawful range of rate indications, including the view that reducing State Farm General's current rates by as much as 25 percent would be lawful and within the zone of reasonableness. That cannot possibly be right."

"There is no universe in which a 25 percent rate decrease is appropriate given the circumstances here," she said.
"

 

[NY independent]

Sounds like they are looking at the tree not the forest. They exist to protect the consumer from unfair pricing increases etc, and probably think State Farm is bluffing on exiting the market in Ca. Quite a gamble....we'll see how it shakes out.

 

[marindependent]

Update:

Consumer Wathdog is now taking more California Action: They "sued the California Department of Insurance and Commissioner Ricardo Lara to block hundreds of millions of dollars in surcharges that could soon appear on California homeowners' insurance bills." Source. They claim "those surcharges come from a decision reached by the commissioner last summer to allow the insurance companies that comprise and operate the California FAIR Plan, the state's insurer of last resort, to pass through costs to policyholders when the FAIR Plan is forced to assess those companies for funds after a catastrophe."

Newsweek reports "Denni Ritter, American Property Casualty Insurance Association department vice president of state government relations, called the legal action a "reckless and self-serving stunt" in a statement to the Insurance Journal, saying it threatens to tip the state's insurance market closer to "total collapse.""

Total Collapse... mind you - not the 'partial collapse that some might argue its in now - but a complete collapse.

So to sum it up, some admitted insurers, have left the state and most admitted insurers are on hold, so consumers are flocking to the FAIR plan, [which might not be actuarilly sound] and which needs to pass along some costs back to the remaining pool of insurers through the FAIR agreement. And we cant possibly allow those remaining admitted insurers to assess "some" of those costs they are charged back to consumers?

Pull up your chair - Popcorn anyone?