At least six states will consider legislation to reform insurance rate setting processes this year, according to a legislative analysis by the National Association of Mutual Insurance Companies.
Neil Alldredge, NAMIC state advocacy director, said that Connecticut, Hawaii, Indiana, Iowa, Massachusetts and New York legislators will have such measures before them proposing what he termed more "competitive" rate setting practices.
The proposals, Mr. Alldredge said, will benefit consumers by removing "restrictive" rating practices, which will encourage more competition.
He said in Michigan, NAMIC will oppose what it considers "anti-competitive" legislation proposed by Gov. Jennifer Granholm.
Her administration's bill would impose a 20 percent rate rollback for auto and homeowners insurance rates and eliminate a provision in existing law that would eliminate the requirement that a lack of competition must exist for rates to be deemed excessive.
"The governor's actions represent a step backward and will have the unintended consequence of making the Michigan market less competitive than it is today," Mr. Alldredge said.
Credit-based insurance scoring and security breach legislation will also be before state lawmakers this year.
Mr. Alldredge predicted that as many as 40 states may introduce insurance scoring bills this year.
"While a few bills may continue efforts to prohibit insurance scoring outright, most bills are likely to seek restrictions where individuals may be involved in 'extraordinary life circumstances,'" he said.
Last year, 21 states enacted security breach notification laws, Alldredge noted. And more states will likely take up the issue this year.
"The more states that enact such legislation, the more they are likely to enact provisions different from each other," Mr. Alldredge said. "This is problematic for businesses doing business in multiple states."
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