Quote:
Originally Posted by Derwood
Isn't the larger problem that the big players in the insurance business more or less collude with one another by sharing information and artificially setting prices? In other words, we have the exact opposite of competition
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Not really. There's already a very efficient countermeasure in place for this problem. Almost every insurance carrier (and the exceptions don't factor into this discussion based on what they do) has to file rates with the state that basically say "our base rates are between x and y". They then credit or debit those rates to compete. If a risk is too cheap, then that will knock some insurors out of the competition. Conversely, if a risk is too tough, then it will knock others out of the competition since they can't get to the price.
I cannot imagine how fucked up my life would get if insurors were no longer required to share information on losses. A couple of carriers tried that about 8 years ago, and it had the opposite effect than I think you intend, Derwood. It killed competition since the competing carriers had no idea what the historical loss history was and could not price things accurately. Granted, this was on the P&C side, so things are necessarily different. But sharing loss history is going to be universal in the industry and I can't imagine a carrier wreckless enough to not even ask about prior loss history in any segment of the industry.
Or are you referring to something completely different and I've made assumptions here?