In parts of the country where rate hike requests are part of everyday life, like Florida, it seems strange to be informed that in other areas of the United States premiums are going down. Yet, there you have it: Six lines of Insurance are reported today to have decreasing and not increasing premiums: Directors and Officers, Commercial General Liability, Worker's Compensation, Term Life, Terrorism Coverage, and in some parts of the United States, Homeowner's Insurance (where there are NO CatClaims).
In addition, it is reported that although Automobile Insurance Premiums are on the rise, they are rising more slowly than the rate of inflation (neither rate necessarily being good, of course). These events are reported in a Subscription Required article by Liam Pleven, "Cheaper Insurance Rates Point to Decline in Life, Business Risks" (Wall Street Journal, Monday, November 6, 2006, page A1, col. 5).
This article certainly seems to be the product of comprehensive reporting. One thing written in it seems to be a shortcut, however. Terrorism and CatClaims Underwriting are mentioned together as causing the same Underwriting headache of unpredictability, which is not the case. Terrorism Risks are by their nature unpredictable. But Risks such as Hurricanes are totally predictable. The body of evidence is huge for Underwriters who choose to predict Hurricane and other CatClaims Risks and, if those Underwriters do not like what they see, they can tell their Companies and their Companies can choose whether or not to accept the predicted CatClaims Risk. As a previous post on Halloween noted here, there does not seem to be the same demonstrated need for a Federal Tax Dollar Backstop for CatClaims Coverage, either, as there is, at least for the near term, for Terrorism Coverage.
REMINDER: THE CONTENTS OF THIS BLOG DO NOT MAKE AN ATTORNEY-CLIENT RELATIONSHIP. ALWAYS CONSULT THE CASES AND LAWS OF EACH PARTICULAR JURISDICTION AND AN ATTORNEY IN AND FAMILIAR WITH THE PARTICULAR LEGAL ISSUE, THE JURISDICTION AND ITS LAWS, WHENEVER YOU TRY TO ADDRESS OR RESOLVE ANY LEGAL QUESTION.
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