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Originally Posted by Derwood
maybe this has been asked before (and maybe it's a non-issue), but would insurance companies all up and relocate to whichever state gives them the best tax incentives? If so, what does that do to the cities/towns whose local economies/employment base are tied to those relocating companies?
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Honestly, this has already been done. And it's been done quite well. Back in the day, most mid-sized cities had several local offices of various carriers (AIG, Travelers, etc.). Those were slowly closed so that now folks in Little Rock, AR conduct most of their business in Dallas, Houston or Chicago, depending on how the insurance companies have set things up.
The problem with relocating to a smaller spot is that there will almost certainly be attrition of talent among the current staff and a lack of experience folks in the new spot. I'm sure that a lot of companies would love to move Wichita to take advantage of the lower wages, lower cost of living, etc., but they don't because they know that there aren't enough experience underwriters, claims adjusters, assistants, etc. to make it work. And it takes time to train someone into that role. An underwriting trainee, at least on the P&C side, typically has 3-4 years of training before they're even allowed to start doing any supervised underwriting.