AAA won't renew our homeowners insurance

[GON]

"""PS Spoke with Farmers guy in more detail after my first contact with them. Both houses, four cars, umbrella policy - no problem - they'd love to get the business. Will sign with Farmers and drop AAA later this coming week.""

Might want to get a quote or two from other insurance companies. I have not checked recently, but Farmers was not so highly rated financially.

I was dropped by Farmers in 1999 after nine years and zero claims. What was disturbing was I overnight-ed a letter to the CEO, and no response whatsoever. After that incident, I would never consider Farmers. Years later I learned Farmers had a below average financial rating compared to its peers.

 

[SeaJay]

Originally Posted by Dinoburner
Once again some entity needs to oversee the insurance companys. While I`m totaly for private enterprise the very nature of greed dictates oversite.


There is a state insurance regulator in every single state in the US. They have the authority and do exercise their authority to regulate insurance Companies. They have to be licensed, they have to have a minimum amount of capital. They have to file copies of their rates and policy forms with the state. In many states they have to file their underwriting plans. They have to use a different type of accounting that is more conservative, and file their results each and every year with each state they operate in.

What I've listed is just the tip of the iceberg. Lots of other things. In many states they need to get permission from the State regulators to raise rates. Many, many other regulations are in place.

 

[Wolf359]

Originally Posted by SeaJay
Originally Posted by Dinoburner
Once again some entity needs to oversee the insurance companys. While I`m totaly for private enterprise the very nature of greed dictates oversite.


There is a state insurance regulator in every single state in the US. They have the authority and do exercise their authority to regulate insurance Companies. They have to be licensed, they have to have a minimum amount of capital. They have to file copies of their rates and policy forms with the state. In many states they have to file their underwriting plans. They have to use a different type of accounting that is more conservative, and file their results each and every year with each state they operate in.

What I've listed is just the tip of the iceberg. Lots of other things. In many states they need to get permission from the State regulators to raise rates. Many, many other regulations are in place.


Yeah, this thread is a little crazy. Companies have the right not to do business with you and they can also decide to exit the market. It's just a business decision. There's a certain point where even though you may collect a 1k premium, if a house burns down and it costs you 500k, there's just no way to raise the premium high enough to cover a much higher risk of that happening. So rather than jack up premiums to 5-10k where it probably wouldn't even get past the insurance commissioner, they just decide to exit the market. Stores do it all the time. If Autozone can't make money selling a particular oil, they clearance it out and then stop carrying it.

 

[Dinoburner]

Exiting a market is one thing, canceling a 65 year customer for no changes to the structures and another insurance company threatining to cancel a customer because there are lichen are begining to form on their roof shingles is something other than a business decision. Obviously the companies are trying to reduce exposure, it`s a simple numbers game, but they are actually harming people with their sky is falling tactics. I remain steadfast in that some entity needs to step in to protect customers. I wonder if these decisions are actuary driven.

 

[Wolf359]

Originally Posted by Dinoburner
Exiting a market is one thing, canceling a 65 year customer for no changes to the structures and another insurance company threatining to cancel a customer because there are lichen are begining to form on their roof shingles is something other than a business decision. Obviously the companies are trying to reduce exposure, it`s a simple numbers game, but they are actually harming people with their sky is falling tactics. I remain steadfast in that some entity needs to step in to protect customers. I wonder if these decisions are actuary driven.


I think I've been accused of being a bleeding heart liberal, but I just prefer that things are fair to both parties.

It's clear that it's a numbers game for the insurance companies. I fail to see the harm that they've actually done to people. They recalculated and figured the risk was too great for them to shoulder. There is no guarantee that people have some sort of right to affordable insurance. If you live in a flood zone, you should be paying more for insurance than someone who isn't. That would only be fair to people who don't live in a flood zone. Similarly, if you're living in a fire zone, you don't get a free pass on cheap insurance. The protection for the consumers is the ability to purchase insurance from another insurance company who calculated the risk differently. In the case of flood insurance, there's a reason why most insurance companies got out of that market, the risks were too high and people who wanted to buy it didn't want to pay the sky high premiums which is why the federal government finally had to step in and subsidize it.

If a company doesn't want to do business with you, they have the right to decide to exit it, just like the customers have a right to take their business somewhere else.