February 7, 2003

Texas Association of Business weighs in on the need for responsible insurance reform in Texas

Let real competition regulate insurance
Austin American Statesman
By Hardy England
Chairman, Texas Association of Business
February 6, 2003

We're all tempted to take short cuts, especially when it comes to repairing nagging maintenance problems and challenges. So when lawmakers want to make quick fixes to the state's insurance system, who can blame them?

If Texas legislators think tighter rate regulation will repair Texas' troubled homeowners insurance market, even their most well-intentioned efforts could place Texans in a far worse situation than we're in now.

I'm astounded by some of the ideas mentioned to fix the problem. Rate freezes? Rollbacks? As the owner of a small business, I can't imagine any company surviving when forced to sell a product below cost. Yet, that's what some are suggesting to stabilize the Texas insurance market.

Rate rollbacks and other price controls have never worked in a free-market economy, and insurance companies will leave Texas if such tactics become the legislative patch for this serious problem. For decades, lawmakers in New Jersey have been trying to manipulate that state's automobile insurance market through rate regulation. As the result, its rates are among the highest in the country.

The way to make the insurance market better for everyone in Texas is to give competition an honest chance to work. Click here to read more...

Insurance reform:
Don’t just get mad, get it right.

Texas Coalition for Affordable Insurance Solutions
www.TCAIS.org

TCAIS is a proactive alliance of insurance providers and trade organizations committed to working with legislators, regulators, consumers and others to find public policy solutions that will improve insurance availability and affordability in Texas.