MICH. LAUNCHES RATE INQUIRY:

Michigan Office of Financial and Insurance Services (OFIS) Commissioner Linda Watters has launched the first phase of her investigation into rising home and auto rates in Michigan. Watters issued a letter of inquiry to insurance companies writing home insurance policies in Michigan. A similar letter to insurance companies writing auto policies is forthcoming. The inquiry requires insurance companies to provide OFIS with rating information for the accident/calendar year 2001 and 2002. Insurance companies have until Feb. 17 to submit their data. A final report analyzing the data will be issued early this summer. The more than 100 homeowners insurance carriers that operate in Michigan are already gathering the information, a state industry lobbying group said. The industry’s response to the state’s “data call” primarily means reformatting and resubmitting data already provided to OFIS as part of annual statements and rate filings the industry is required to file by law, the Insurance Institute of Michigan said in a statement. While homeowners insurance rates have increased 10 to 30 percent during the past few years, rates are not arbitrary. They are a true reflection of insurance losses, the group said.