How To Choose The Best Life

 California Life Insurance Commissioner’s Plan For Managing Climate Change Risks Draws Criticism

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Given a time of fast-moving climate change, wouldn’t you like to know what the chances are of your house being in the path of a wildfire?

It’s a question most homeowners would like answered and so too would California’s insurance industry. Toward that end, the state insurance commissioner formed the Climate Insurance Working Group to “make recommendations to reduce the threat from wildfires, floods, mudflows, urban high heat, sea-level rise” and other impacts from climate change.

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But the group’s draft report has drawn controversy. Critics contend the resulting 67-page document heavily favors the insurance industry.

“The report has been hijacked,” said Consumer Watchdog‘s Carmen Balber, a longtime expert on the insurance industry in California.  She notes that the working group included two insurance industry executives and an industry lobbyist, “but not a single consumer representative.”

Deputy Insurance Commissioner Michael Soller counters saying his boss Ricardo Lara is a member of the working group and the commissioner is “the state’s top insurance consumer advocate.”

Balber notes that much of the report is about the effects of climate change, something that those inside and outside the insurance industry can agree on. But there is one key element in the report that is causing concern for consumer advocates like Balber.  It’s how insurance companies will be setting their rates in the future. How exactly will these rates be determined, she asks?

Under California’s Proposition 103, transparency is part of the process when insurance companies set rates. Where you live and the materials used to construct your home are among the factors used to determine your rate, and consumers are entitled to know what those factors are.

But the working group includes a suggestion to determine how rates would be set. It is called a “catastrophe model” — an algorithm that includes a wide range of risk factors. How the factors would be weighed is unknown now, and if the working group has its way, it would never be known, said Balber.

If new climate crisis regulations were created the weight given those factors would remain confidential under the proposal. Only the insurance industry and the third party that created the algorithm would know.

Commissioner Lara’s office aid the model is only one of several recommendations and Lara will review whatever model is finally chosen to make “sure it meets his goals of reducing costs and increasing access to insurance coverage for Californians.” He has not endorsed the catastrophe model.

Balber said these findings of the group are “really disappointing.” She worries the industry sees an opportunity “to use the climate crisis as a back door around Proposition 103 transparency.”

JW August is a San Diego-based broadcast and digital journalist.

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Mom Fights With Insurance Company To Get Disabled Daughter Wheelchair

(CBS4)– Madeline Meier’s genetic disorder is so rare it doesn’t even have a name.

“To this date no one else has been described with this mutation. So we don’t have a road map for what Maddie’s life looks like,” said her mother, Melissa Meier.

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She says Maddie, who is 3 years old, started having seizures when she was 6 months old. Doctors discovered she had a point mutation in chromosome 1, very important for nerve and muscle development. Maddie can’t talk, has developmental delays, seizures, and can’t sit by herself. Melissa says she’s been desperate to give her daughter some sense of normalcy.

“I think people see Maddie and see that all she wants to do is go out and explore,” she told CBS4’s Dominic Garcia.

Melissa, a physician, consulted with a team of experts to see what kind of wheelchair her daughter needed. They settled on a specialized one that can rotate in space but keep her in a seated position. The cost was around $7,000, but their insurance, United Healthcare denied it.

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“They denied it because they said it won’t grow with her. This wheelchair has 4 inches of growth in width, and 3 inches to grow in depth and they said that’s not enough. And just for fun we measured and my 11-year-old could sit in that wheelchair,” Meier told CBS4.

Melissa said the chair is so specialized that if it’s too big, it won’t work for Maddie.

“You don’t go and buy pants that are three sizes too big because you don’t want your kids to outgrow your pants. No one does that,” Melissa told CBS4’s Dominic Garcia.

She says it wasn’t until after CBS4 contacted United Healthcare that her wheelchair was approved. After the interview with Melissa, United Healthcare sent a statement, “UnitedHealthcare provides coverage for wheelchairs and medical strollers based on members’ medical conditions and their health insurance benefits. We worked with the wheelchair company to provide coverage for a wheelchair that meets Maddie’s needs under her family’s plan.”

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Melissa is grateful her daughter’s wheelchair has been approved, but says it shouldn’t have to come to this.

“We are fortunate enough to afford to buy her this wheelchair, but I had to tell this story because there are so many people who don’t have the ability. They’re at the mercy of these insurance companies who are denying this so they can save money. These kids just want to be able to go out into the world”.

DeSantis Signs Property Insurance Bill, Says Florida Lawmakers ‘must Do More’ To Lower Costs

Florida’s 6.5 million businesses and homeowners will see some significant changes in state property insurance regulations beginning July 1 after Gov. Ron DeSantis Wednesday signed a reform package into law.

Senate Bill 76 slashes the time to file claims from three years to two, reduces attorney “multiplier fees” and allows insurers to cover only the depreciated rather than full value of replacing roofs more than 10 years old.

The new law also lifts the 10% cap on premium increases for customers of Citizens Insurance, the state-backed insurer of last resort.

The bill was sponsored by Sen. Jim Boyd, R-Bradenton, an insurance agent by trade and the chair of the Senate’s Banking & Insurance Committee, to address rampant flood and roof related insurance litigation.

An Insurance Information Institute report documents lawsuits against Florida property insurers increased from 45,000 in 2018 to 150,000 in 2020, with roof-related claims increasing from 27,000 in 2013 to 85,000 in 2020.

According to January’s “Florida’s P&C Insurance Market: Spiraling Towards Collapse,” co-authored by Tallahassee-based James Madison Institute, about 6% of Florida homeowners insurance claims are in litigation, amounting to a “solid Cat 3 hurricane” in costs.

The instability threatens the financial viability of about 60 independent private insurers operating in Florida’s property insurance market, abandoned early this century by large insurance corporations, and to grow enrollment in Citizens, increasing the state’s liability exposure.

Citizens, a non-profit created by state lawmakers in 2002 to provide insurance to homeowners unable to acquire coverage, reports its policy count grew by more than 100,000 in 2020, topping a half-million for the first time since 2015, and expects up to 650,000 enrolled by December 2021.

In addition to excessive litigation, insurers cite ballooning reinsurance costs, “loss creep” from 2017-18 hurricanes and coastal flooding for imposing double-digit rate increases as high as 45% in property insurance rates over the last year.

The state’s Office of Insurance Regulation (OIR) reported it approved 105 property insurance rate changes in 2020, including 90 for increases and 55 for increases above 10%.

SB 76 was among 15 bills DeSantis received Wednesday adopted by lawmakers during their 60-day 2021 legislative session that adjourned April 30.

The bills go into effect after 15 days barring a veto by the governor, meaning bill-signings are largely ceremonial.

But DeSantis chose to sign SB 76 and do so right away, explaining in a Wednesday video appearance before Enterprise Florida’s Board of Directors that the new law will help, but more must be done.

“I think we got a lot of good stuff done in the legislative session, one of the things we’ll be, I know we worked on, was some property insurance reform, to try to stem some of the problems we see in that market,” DeSantis said.

“We want this to be affordable for homeowners. We don’t want it to be something that is just kind of a pot for litigation,” he continued. “And that really is what was happening in Florida. I mean a huge, huge proportion of the money was going to litigation expenses.”

DeSantis said “manageable premiums” and a “stronger private insurance market,” where payments go “to the actual claimants rather than to the attorneys” will remain a focus in coming years.

“It’s something that we’re working on, and we’re watching very closely,” he said. “But we’re probably going to have to do more going forward.”

Among changes that go into effect July 1:

Instead of capping rate hikes to 10% for those enrolled by Citizens, that limit will be gradually raised to 15%.

Contractors are prohibited from soliciting homeowners and offering incentives to file insurance claims and outlaws public insurance adjusters from offering incentives to inspect for roof damage.

Limits attorney “multiplier fees” through a formula that gauges how much money is awarded in court judgments and how much money was offered by insurers to settle claims before the lawsuits.

Reduces from three years to two years the time to file claims, with an additional year for supplemental claims.