Insurers are working to provide immediate relief directly to policyholders; flexibility needed to allow private, competitive markets to work
WASHINGTON, D.C. — David A. Sampson, president and CEO of the American Property Casualty Insurance Association (APCIA) issued the following statement regarding the California Department of Insurance’s call for premium reductions for six lines of personal and commercial insurance.
“Over the last two weeks, insurers have announced billions of dollars in premium rate relief to their policyholders.
“Insurance is a data driven industry. Rates are continuously adjusted based on losses and claims costs. If regulators allow insurers flexibility, private competitive markets will work to the benefit of consumers.
“For example, the impact of COVID 19 on driving patterns are reflected in the data some companies are seeing on crash frequency and severity and a number of companies have already responded. Some commercial lines policies, such as workers compensation, are audited each year to reflect changes in risk and claims so premiums are adjusted at that time.
“Now is not the time for arbitrary calls for rate decisions. We urge all stakeholders to support flexibility in the marketplace. California has the most complex regulatory structure in the nation. The Department should be providing guidance to companies that are trying to implement premium reductions within the confines of Proposition 103.
“There are a number of ways that auto and commercial insurers are currently helping customers manage costs. During this extraordinary crisis, companies are voluntarily offering arrangements for:
“Individuals going through extraordinary life circumstances should call their insurer or agent to discuss their options.
“Only the federal government can be the bridge for a crisis of this proportion. APCIA supported the recently enacted federal assistance programs that will deliver aid directly to vulnerable business communities, particularly affected small businesses. APCIA also joined a broad coalition of our customers to advance the COVID-19 Business and Employee Continuity and Recovery Fund as an additional tool to keep businesses solvent and employees working. We will be advocating alongside them for inclusion of the fund in the next phase of economic stimulus to speed payments to businesses in need.”