SACRAMENTO, Calif. — California’s insurance coverage commissioner on Thursday ordered practically 50 auto insurers to present detailed information about their declare prices through the pandemic, his newest try to compensate customers he says have been overcharged as site visitors just about disappeared when the nation’s largest insurance coverage market imposed the primary U.S. coronavirus stay-home order.
Commissioner Ricardo Lara gave California’s main insurers 30 days to reply.
“With this letter, every insurance company is on notice to give us data so we can tell them what they owe consumers,” stated Deputy Insurance Commissioner Michael Soller.
It’s the newest salvo in a dispute over whether or not Lara’s refusal to approve greater than three-dozen price hike requests over the previous 29 months threatens insurance coverage firms’ potential to write insurance policies in California. Insurers already gave again $2.4 billion in extra pandemic profits however say they’re now shedding cash as site visitors has rebounded to pre-pandemic ranges, with inflation and provide chain shortages compounding the price of elevated claims due to worsening driving habits.
“We are concerned about the effect that CDI’s inaction is having on the auto insurance market and California drivers,” stated Denni Ritter, vp for state authorities relations for the American Property Casualty Insurance Association.
She stated insurers “are heartened to see the department make some moves towards at least reviewing these filings” and can present knowledge she stated will “demonstrate the extreme cost drivers that CDI has been ignoring.”
Several main firms have stated they’re chopping again their California advertising or operations, with the CEOs of Progressive and Kemper final month tying their choices to Lara’s failure to take into account price will increase.
The dispute comes as Lara runs for reelection in opposition to Republican Robert Howell, who is just not anticipated to pose a severe risk.
The firms say Lara can’t power the extra refunds he says are nonetheless owed customers, due to a 2021 appellate court docket choice that he says they’re deciphering too broadly. Lara’s demand letter is his newest effort to attempt to incorporate insurers’ earlier profits into their present price enhance requests.
His letter went to 47 firms doing enterprise in California, addressing 54 price enhance purposes together with 38 which have been stalled for months.
Insurers’ claims prices “became overstated as a result of policyholders driving significantly less,” the letter says. “On behalf of California consumers, the Department of Insurance seeks premium refunds in the full amount of what policyholders are owed.”
The detailed value information shall be thought-about within the division’s evaluation of any pending or future price enhance requests, says the three-page letter. It has a separate “refund information workbook” — a spreadsheet with 5 subcategories for firms to broaden on requested particulars in at the very least six totally different areas.