The post, Ding Dong the Wicked Insurance Witch Is Dead! Florida’s Insurance Commissioner Resigns!, generated a great deal of comments from readers. The Wizard of Oz is my favorite movie, and lessons are abundant in the story. However, some missed the point of the post, which is found in the last paragraph:

All policyholders and I can do is celebrate his resignation. Most of us have felt like the munchkins in a faraway land and ignored ever since Altmaier was appointed Florida’s insurance commissioner.

Some readers suggested that Altmaier should be prosecuted for something or “locked up” and that Florida’s politicians are being bribed. Not so, and in response, I noted:

He is a bright man. I just do not think he was right for this job.

I am very happy he has offered his resignation because Policyholders deserve better.

And,

… I do not suspect the Governor nor any Florida politician of being bribed and have no evidence of it. Indeed, I have heard of Governor DeSantis warning people not to contribute large sums because it will not matter.

…

We need great leaders who work hard and with courage. We deserve leaders that can tackle tough issues fairly and with great wisdom if we demand that from those responsible for appointments. We do not need insurance industry shills in this position.

This post was meant to show my happiness when I heard that the leader of the Office of Insurance Regulation had resigned. My view is that his performance was disastrous for the insuring public.

A lot of people properly commented about the increase in premiums and not being able to find insurance carriers who would provide coverage. I wrote a number of responses, most of which make this point:

My prediction is that this legislation is so favorable to new insurance companies, that they will be back because it will be a profitable feeding frenzy.

The rates will be high and you may not have your insurance claim paid, but you can find another company to buy your insurance.

Some properly commented on the increase in litigation and AOBs. I made numerous responses to this, and one in particular I would like to share:

Insurance is a social product. If losses happen in one part of the state, it can impact overall losses in another part of the state. Indeed, national property losses have an impact on our reinsurance rates.

So, if there is gamesmanship going on regarding the litigation of AOB claims, it impacts all of us. I think that is a point all of us have to come to grips with no matter what side of the aisle you are on.

This AOB problem does not excuse the horrible underpayment of claims, the raiding of surplus by insurance executives, the feigned statistics leading to bad laws nor the ignoring of policyholders which our soon to be insurance commissioner was allowing on his watch.

Insurance commissioners are very important governmental positions because we extensively rely upon the product in our personal and business lives. Historically, insurance companies want to:

  1. Charge rates without government interference. This interference has led to disaster because they historically will charge both too little, leading to bankruptcy, and too much because rate-making is exempt from anti-trust laws.
  2. Want to be free of regulation questioning claims handling and motives for wrongful claims conduct.
  3. Do not want lawsuits from private parties and policyholders with a vested interest to uncover wrongful claims conduct or question the propriety of a claims decision.
  4. Do not want regulators asking about how the premium money is spent and whether expenses are legitimate rather than being siphoned off into the hands of the insurance company executives through favored management contracts or related company deals.

My view has been that our soon to be ex-insurance commissioner was working for the executives of insurance companies rather than policyholders on these issues. I do not know the reasons or motive for his doing so. Many speculate that his resignation is motivated to avoid the anti-lobbying law coming into place on January 1, so he and others on his staff can be retained by the insurance industry. Time will tell.

We need to support an appointment of a new insurance leader who will have the intelligence to fix problems as they arise, courage to regulate, and leadership to build consensus. I am convinced we can do much better, although Florida is always going to have property insurance issues in the future, given the geography and significant increase in population.

Thought For The Day

A baby has brains, but it doesn’t know much. Experience is the only thing that brings knowledge, and the longer you are on earth the more experience you are sure to get.
—The Wonderful Wizard of Oz