Keep the car insurance Business Competitiveness
In”Der path of deflation insurance rates”(Op-Ed, March 29), Bob Hunter and Jay Angoff blame for everything that rising auto insurance premiums, except higher costs.
Auto insurance pays for items in higher overhead faster than the inflation rate. These include medical assistance and clinic for the wounded, the legal defence for the insured, the owner of the return flight oder”belief”Autos, and the cost of labour and parts to repair cars damaged. Given that these costs increase, ie insurance rates.
Mr. Jäger, Mr. Angoff refuse the high cost for insuring a car in”mehreren urban areas.”While we do, but also the number of insurance claims and costs to resolve them to rise spectacular in many areas.
Even in metropolitan areas the differences in costs can be considerable. An average driver in Los Angeles has also helped to pay much more than four times more for basic research insurance protection as a pilot similar to Atlanta, because the laws on appeals for greater liberalization in California , And costs related to demands for accountability increase dramatically in California. From 1986 to 1987, the average cost of each car Aetna California state responsibility, jumped 24.2 per cent.
Mr. Jäger, Mr. Angoff also lightly say that the repeal of the McCarran-Ferguson Act, the force of competing insurers and therefore lower prices of auto insurance. McCarran-Ferguson, public regulation of the insurance sector, so that all commissioners in the state and respond to concerns of insurance at the local level. In addition, it allows insurers to collect data on the insured loss. The competitiveness of small insurance companies, especially would be violated by their inability, access to these data. In passing McCarran-Ferguson, Congress has accepted its provisions were necessary for the functioning of the insurance business and consumer interests.
What would happen actually on the market, if McCarran-Ferguson have been lifted? We do not know and can do so. But there are no facts support the hypothesis that the repeal would lead to a greater or low availability. In fact, the federal system could lead to the increase in subsidies to urban areas at high risk for a driver to lower pilot rural and even higher tariffs on auto insurance. It would then be consumers, the insurer would be very seriously injured by the abolition of McCarran-Ferguson.
A result of the McCarran-Ferguson Act is a very competitive insurance market in which insurers, large and small to win the battle profitable business. Because this competition, including a large national organization, as Aetna May hopes win only 4 percent or 5 percent automobile insurance rates.
Insurers compete with hundreds of premiums for drivers to the security of each state, and there are few restrictions for others wishing to do likewise. But those who think it is simply a store, a underregulated business, a shop are not competitive or renditestarke for a nasty surprise.
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