VAN DREW OPPOSES DEREGULATION IN RATE REPORTS

Senator Jeff Van Drew recently notified the Department of Banking and Insurance of his objection to proposed rules that would repeal regulations requiring auto and homeowners insurance providers to annually report their rates to the state.

The Senator officially commented on proposed regulations by the department in a letter sent last week to the department and to Banking and Insurance Commissioner Thomas B. Considine.

“In my review of the proposal, I found that the Department has failed to justify these proposed repeals and that consumers will ultimately be harmed if the Department allows the rule proposal to be adopted as originally drafted,” wrote Senator Van Drew (D-Cape May/Cumberland/Atlantic).

The Senator also expressed concern that the department, even before the conclusion of the rulemaking process, has told insurance providers there is no need to submit their rates for 2010.

Senator Van Drew noted that consumers rely on the information reported by homeowners, renters and condominium insurance providers to make informed purchasing decisions. He said the reporting requirement for auto insurance providers ensures that companies properly evaluate risk, on which they base their rates.

“While I applaud your efforts to increase efficiency within the Department, as well as lessen the administrative burdens of insurers, I believe those goals cannot trump consumer protection. This rule will do such injustice,” Senator Van Drew concluded.

The comment period on the proposed rules ends Friday, January 14. The Senator’s official response to the proposal is attached.

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