Targeting Speed-to-Market Reform

No one can argue that the insurance industry has been beleaguered with inefficiencies. Carriers battle with changing regulations and market conditions nationwide, while agents and brokers struggle with shifting requirements and demands set forth by the carriers. And so it is the consumer (and agent), who often suffers the consequences of an insurance market that may not be as competitive and available as it should be.

Most will agree that insurance regulation reform is long overdue. But, reforming such a massive and diverse industry will be no easy task. As with any government reform process this task will no doubt be accompanied with waiting and more waiting. In the meantime, conditions remain arduous for carriers wanting to introduce new products into the marketplace. Of course, market availability is not only vital to the industry, but most importantly to the consumer.

Relocating to California opened my eyes to a new world. LoJack, for instance, seemed like a foreign word. Is that some sort of equipment to change my tires? I asked my insurance agent. No, he said. And earthquake damage; you mean it’s not covered in a homeowners’ policy? No, my agent kindly replied again. Boy, was I in for a rude awakening. My experience solidified my presumption that insurance is a regional force not to be reckoned by general standards. Yet, there continues to be a drive towards federal insurance regulation despite the industry’s specific regional needs.

In recent weeks, industry advocates shared their views on the current regulatory process at a hearing for the U.S. House of Representatives’ Financial Services Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises. The hearing’s purpose is to examine possible ways to reform insurance regulation while making the marketplace more competitive for consumers.

For decades state governments have regulated the ins and outs of the insurance business. So why would we re-create the wheel, or fix what isn’t broken, by pulling regulatory control into the federal government, instead of simply mending the areas of utmost concern? Notably, working to increase the availability of stable and financially secure markets to better serve consumers. In a time when quality markets are, to say the least, difficult to come by, reform efforts targeting speed-to-market options should be a top priority. Agents need options, and most importantly so does the consumer. Write your representative, or contact your association to advocate for a more streamlined system of reform. There’s no reason bureaucratic policies should interfere with market availability. For up-to-date information on insurance regulation reform efforts, and other breaking news headlines, sign up for Insurance Journal’s online daily e-mail newsletter.

As always, we appreciate your feedback and suggestions. Don’t hesitate to send me an e-mail or give me a call at (626) 792-5209 to share your story ideas or breaking news tips. On behalf of all of us at the Insurance Journal, thank you for your patronage and Happy Thanksgiving.

Topics Agencies Legislation