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April
3, 2003
Senate
Bill Will Make Insurance Harder to Find for Texans
New
insurance study shows that regulation of the insurance marketplace
must seek to complement rather than distort the laws of supply
and demand.
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Tell
your legislators that SB 14 would take our state in
the wrong direction.
ACT
NOW!
The Texas Public Policy Foundation
released a study this week which found that restrictive
legislation such as SB 14 will hurt Texas consumers,
eventually leading to even higher prices and less availability
across the state.
Click here to read the study.
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Senate
Bill 14, passed by the Senate Wednesday will make it increasingly
difficult for Texans to find insurance. This legislation would
be a step backwards for Texas by discouraging competition,
limiting consumer choice and inevitably raising prices.
The Texas
Coalition for Affordable Insurance Solutions (TCAIS) continues
urging lawmakers to pass legislation that will bring more
insurance companies to Texas, providing homeowners more choices
at more competitive prices.
Insurance companies are not afraid to be regulated.
Yet, new studies are finding that government price controls
and arbitrary regulation, such as what’s found in SB
14, will not lower insurance rates for Texans in the long
term. Competition is far more effective in regulating the
market than any government mandate.
For
Texans to truly benefit, the insurance market needs certainty
and predictability...not ambiguous regulations that can be
moved by the politics of the day.
While we appreciate the long hours spent developing
the bill and the Senate’s rejection of several amendments
that would have further stifled competition, we still believe
that the rating structure in SB 14 will not create a competitive
and predictable insurance market - something that will attract
more insurance companies to Texas.
TCAIS believes legislators should give Texans
the full benefits of a healthy, competitive insurance market
with regulation that focuses on consumer protections designed
to make sure insurance companies are financially healthy and
treat their policyholders fairly. House Bill 3346, by Representatives
Arlene Wohlgemuth (R-Burleson) and Larry Taylor (R-Friendswood),
contains several positive elements that could move insurance
reform in the right direction by creating an environment that
encourages more companies to enter the Texas market and compete
for customers.
Texas
Public Policy Foundation study finds that insurance “coverage
will dry up for Texans unless the legislature stimulates,
rather than contracts, the market by enticing capital back
to the market and enabling the law of supply and demand to
work.”
SB 14 ignores the findings of a study released yesterday by
the Texas Public Policy Foundation. In "Shopping for
a Solution," Nat Shapo, former Director of Insurance
in Illinois, warns that "mismatched use of government
power has yielded poor results. Although price controls may
initially lower consumer costs, price controls do not produce
lower insurance rates in the long term, as are produced by
competition."
Click
here to read the full study.
We all want to
fix Texas’ insurance market. But let’s don’t
just get mad. Let’s get it right.
Beaman
Floyd
Director
Texas Coalition for Affordable Insurance Solutions
About
TCAIS: TCAIS member companies include: Allstate Insurance
Company, American Insurance Association, Nationwide Insurance,
State Farm Insurance Companies and USAA.
Click
here for more information on TCAIS solutions: seven guidelines
for insurance reform in Texas. |
