The American Property Casualty Insurance Association (APCIA) responded to the California Department of Insurance’s recent workshop addressing the inclusion of Net Cost of Reinsurance in ratemaking.
The workshop is part of broader efforts by Insurance Commissioner Ricardo Lara to advance his Sustainable Insurance Strategy.
In a statement attributed to Laura Curtis (pictured above), APCIA’s assistant vice president of state government relations, the association underscored the importance of reinsurance in stabilizing California’s insurance market.
"Incorporating reinsurance into ratemaking is one of several critically needed reforms to stabilize California’s insurance market. California is the only state that does not allow reinsurance to be included in ratemaking,” she said.
“We appreciate Commissioner Lara for taking this step as a part of his Sustainable Insurance Strategy. We look forward to carefully reviewing the regulation and working with the Department to ensure it effectively improves access and availability to insurance for all Californians,” Curtis said.
APCIA, a national trade association representing home, auto, and business insurers, advocates for private competition in the insurance sector to benefit both consumers and insurers. The organization has a history spanning 150 years and includes members of varying sizes and structures across the United States and globally.
The workshop follows last month’s announcement that final wildfire catastrophe modeling regulations were submitted to the Office of Administrative Law for approval.
In a separate statement attributed to Mark Sektnan, APCIA’s vice president of state government relations, the association supported the integration of forward-looking catastrophe models into the state’s insurance framework.
Sektnan noted that these models are vital for stabilizing California’s insurance market and acknowledged Lara’s efforts to include the reform in his sustainability strategy.
The California Department of Insurance’s proposed changes aim to address ongoing challenges in the state’s insurance market, particularly those related to the increasing frequency and severity of wildfires.
By incorporating advanced catastrophe modeling, the department seeks to improve insurers’ ability to assess risk and price coverage more accurately in a volatile environment.
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