Promoting Competition:

Texas needs public policy that promotes a competitive insurance market

To improve insurance affordability for all consumers, any legislative and regulatory action should promote healthy competition, so Texans can get the best price possible for their insurance coverage.

• In almost any industry, competitive markets - offering a variety of prices and products - provide consumers with greater choice and better service than highly regulated markets. Insurance is no different.

• In states where insurance companies are allowed to compete for business based upon the products they offer, the prices they charge, and the service they provide, consumers have greater choices and benefits.

• "[I]n the long run, rate regulation does not significantly reduce prices for consumers. However, it generally reduces availability of coverage, increases price volatility, and reduces the quality and variety of services available to consumers." J. David Cummins "Property-Liability Insurance Price Deregulation: The Last Bastion" AEI-Brookings Joint Center for Regulatory Studies, 2002

  In states where rate regulation is restrictive, insurance competition is hampered. New companies are reluctant to come into the market, while existing companies may stop offering policies or exit the market completely. The result is that consumers have fewer choices and benefits.

TCAIS will work with insurance companies, state leaders, consumers and other interested parties to find solutions for the issues affecting the homeowners and auto insurance markets in Texas.

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