INDIANAPOLIS (Jan. 25, 2007) - The National Association of Mutual Insurance Companies (NAMIC) warned Mississippi Insurance Commissioner George Dale that sections of a proposed regulation to better inform homeowners about their insurance policies could drive up their premiums. The comments were expressed in a letter to Dale from Liz Reynolds, NAMIC’s state affairs manager for the southeast region.
“NAMIC agrees that helping to better educate consumers about their insurance is a worthy goal,” Reynolds wrote. “But after reviewing the proposal and consulting with our member companies, we do not believe the cost of preparing and distributing additional paperwork will actually lead to more informed policyholders.”
Included in Regulation 2007-1 are provisions for insurers to provide policyholders with an outline and checklist, which Reynolds said are unnecessary and would only add to insurers’ regulatory burden.
“The information that policyholders need is currently contained in their policies and declarations pages,” Reynolds wrote. “There is no guarantee that providing them with additional paperwork will ensure that they will read or understand their policy provisions any better than they do now.”
Reynolds asked the commissioner to remove, or at least modify Sections 5 and 6 of the proposal.
“Perhaps a more reasonable method for encouraging better policyholder understanding would be for the Insurance Department to provide the outline and checklist on your website, so consumers could print it off and take it with them when they meet with their insurance agents,” Reynolds said. “It would provide a guide for them to ask relevant questions, without creating additional paperwork and administrative expenses for insurers.”
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