Insurance Regulation - Florida Braces As State Farm Waves Goodbye

This week, State Farm Insurance Company, the largest private property insurer in the state, announced his retirement in Florida after suffering heavy losses and denied rate increases.

I'm not a fan of the games and scams insurance industry. Although insurance makes our modern life and their way of life possible, is riddled with problems. Insurance companies regularly kill their customers. They delay, deny and minimize claims as standard operating procedure. But they also pay a lot of complaints, too, and deserve a profit.

In this environment comes the insurance regulators from all 50 states. They try to protect the consumer. Regulations of too little swing like a pendulum. But now in Florida, the pendulum of insurance regulators has shifted to over-regulation. Regulators and state legislators have spoiled the insurance market in Florida, and consumers will burn.

The Florida Department of Insurance has not provided evidence that the insurance market has failed, which could explain the rigid price regulation rather than simply allowing competition in the market for regular premiums.

Over the past 15 years, period, insurers in Florida have been profitable as a group. Dozens of insurance companies have ceased operations in the state. Simply denying rate increases do not benefit consumers. Since insurers stop writing policies in Florida, the reduction of competition makes consumers worse off with higher premiums and limited choices.

In response to the outputs of the insurance since Hurricane Andrew, Florida lawmakers created Citizens Property Insurance Corporation (CPIC), a profitable state-owned insurance company that sells its policies below cost. This ridiculous price, along with the outputs of the insurer, the insurer makes CPIC more than half of Florida's homeowners. For CPIC is losing money, and state property, these losses will eventually require taxpayers and consumers to rescue another insolvent company.

With the departure of State Farm Florida, CPIC may end up securing 80% of households in the state. CPIC is nearly insolvent right now. Everything is a big catastrophic hurricane to destroy him. However, it will be consumers in Florida and the taxpayers ended when forced by the state legislature to rescue the state insurance.

Excessive regulation of insurance companies was also shown recently in New Jersey. As in Florida, New Jersey lawmakers and regulators were up-regulated in the auto insurance market to the extent that the insurance companies left the state in droves. New Jersey drivers found it almost impossible to buy car insurance at any price. In 2003, legislators and regulators recovered his sanity and carried out reforms that brought prices back to competitive motor insurance. Rates are falling and people can find new cheap car insurance in New Jersey.

State regulators sometimes do more harm than good. Sometimes, they do well.

Now I would like to offer two special reports at no cost. One of them is "5 things to do when shopping for car insurance," and the other is "5 things to avoid when purchasing car insurance." Each is worth $ 9.95, but free to you when you sign up for my newsletter at the website address below.


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