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HOMEOWNERS RATE REVIEW OUTLINE
Draft description by Charles Angell, Al DOI
Posted 5/7/2011
About Jim Ridling & DOI Rate Setting
In a meeting in his office with 6 people from HHII two years ago almost to the day, Mr. Ridling compared Mobile and Baldwin counties to a defective product.
In public meetings in Mobile and Baldwin counties, he has said, more than once, he
can't do anything about our high premiums.
He told one of the TV stations that he and DOI do not collect data in a way as to ascertain whether the exhorbitant difference charged the coastal counties for homeowners over the state average is justified.
The state regulatory body does not have county-by-county data to compare the cost to repair the rest of the state after 550 tornadoes to our cost to repair after one hurricane. Yet, based basically on hunches, he and his regulatory body permits the exorbitant inequity charged our area compared with the rest of the state. (Last reported state average is $850/ year, with normal deductibles).
As Commissioner, Ridling testified to the legislature that he "saw no
need" for the transparency bill. Now that he has been reappointed by
the new governor he will likely be unwilling to backtrack on that
statement.
Also, let us not forget the experience with the Senate Banking and
Insurance Committee last session. The transparency bill died in that
committee by several negative votes, which included nay votes by Sen.
Harri Anne Smith and Sen. Preuitt and testimony against it by lobbyists
from the Fine-Geddie firm. Sen Preuitt did not seek reelection and both
he and Sen. Smith are under indictment in the Milton McGregor
matter. We do not know yet the makeup of the Senate Banking and
Insurance Committee but hopefully they will be less under the influence
of the insurance lobby this time around than they were the previous.
Revised 1/5/2011
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ARE INSURANCE COMPANIES REALLY LOSING MONEY
IN COASTAL ALABAMA?
Normally HHII does not like to get into insurance company profits because we want the companies to be healthy and able to pay our claims. Also, it gets crazy trying to figure out what numbers they are actually using. Who cares how much money they make as long as
premiums are just and fair and claims are promptly paid. But, ALDOI has sent out a slide presentation
to all the commissioners that seems to imply that the
Property/Casualty industry is about to go under.
A report
written by Robert Hunter, who is well known in the
insurance field having testified in Washington on the topic over
50 times, addresses the perception that the P/C insurance is a
high risk business that is financially threatened by
catastrophic weather events.
Please read through both these lengthy downloads and note the recommendations and principles
at the end of Hunter's report.
Updated 9/10/2011
Department of Insurance Hearings
Alabama law permits individuals who believe their homeowner insurance
premiums have been unjustly increased to ask for a hearing before the
Alabama Department of Insurance.
Carol Peterson has had her request for a hearing rejected by the DOI, despite what seems like a clear law requiring DOI to give her one. HHII delegates met with the Attorney General's office ten days ago regarding the rejection. They said their initial reading of the law suggested the DOI is in violation of it. They spelled out the steps Carol needed to follow to get the Attorney General's office involved.
HHII's Public Hearing Committee will meet Tuesday to fill out the forms needed for the Attorney General in order to get that ball rolling. They will also be developing
a list of others who will begin the process of asking for a hearing as well. They will help everyone begin the first step necessary to follow in Carol's footsteps.
HHII may not succeed initially in getting the department which has approved these high rates to reverse itself. But, that's not the point. The point is to focus public awareness on the fact that the DOI does not have its own independent, county-by-county data justifying the extraordinary difference in prices charged our widows and orphans. When a hearing is granted, Carol (and all the rest) will demand, first, theDOI's independent, county-by-county data.
This is one of several movements going on all at once, including the ongoing development of the Property Insurance Clarity Bill wich would require the DOI to collect this county-by-county data and make it public.
Posted 2/27/2011
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