Insurance Regulation

The Federal Insurance Office has begun fielding comments on what its role should be, including a call from the Risk Management Society for a larger federal role in insurance regulation.

The comments from industry trade organizations come as the FIO works to compile a comprehensive report on the insurance industry as required under the Dodd-Frank Act. That report is due to be released early next year.

Scott Clark, president and director of RIMS, wrote in the organization’s comment letter that the existing regulatory structure, which is led by the states, has inherent flaws. Clark said enacting an optional federal charter could help to address some of those issues. continue

Texas auto insurance problem – In the city of Corpus Christi, Texas, Police Chief Troy Riggs has launched a campaign to crack down on the uninsured motorist problem in the city by setting up checkpoints where officers ask for proof of insurance from motorists.

If a driver is found to lack coverage, Riggs’s department will go beyond issuing a standard citation and fine and will be towing uninsured vehicles to an impound yard.

[Update: Jan. 2011] Over the New Year’s weekend, the Traffic Section of the police department conducted two- and two-and-a-half-hour checkpoints at different locations over the city. According to Senior Officer Tony Acevedo, a total of 250 vehicles were stopped, 95 citations were issued and 16 vehicles were impounded after their drivers failed to provide proof of auto insurance coverage.

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As part of an ongoing effort to reduce traffic congestion and the negative effects brought by that congestion, the New York City Department of Transportation has formally requested information on the state of pay-as-you-drive auto insurance programs across the nation and on ways that the city could help implement such programs statewide.

The department issued last week a Request for Expressions of Interest (RFEI) outlining some of the types of information that the department is interested in, such as whether there are barriers to implementing pay-as-you-drive programs in the state and whether programs already in place have effectively cut total miles driven.

Insurers already use a driver’s estimate of how many miles he or she will drive in a year as part of their rating formula. This factor is used to assess risk and determine premiums because statistics show that drivers who put in fewer miles behind the wheel tend to file fewer claims.

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Beginning drivers in Michigan now have greater restrictions on when and how they can drive unsupervised.

A bill signed into law on Tuesday affects drivers who are in stage two of the state’s graduated licensing process, allowing them to carry only one passenger under the age of 21 while driving unsupervised and moving up the nighttime driving curfew to 10 p.m. The previous curfew was midnight.

A motorist with a level-two graduated license has had at least six months’ worth of supervised driving. According to Rep. Richard LeBlanc, the average Michigander at this stage in the licensing process is 16.5 years old.

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