Oklahoma Insurance Commissioner John Doak’s ordered a public hearing to explore an increase in earthquake insurance rates in the state. The hearing will be held May 24 and will include data gathered by his department.
“This is a proactive move to protect consumers,” said Doak in announcing the hearing. “We’ve seen some rate increase filings up to 100 percent come through the office and we want to make sure we have a reasonably competitive market. There needs to be a valid financial basis for any rate increase and healthy competition that benefits consumers.”
Doak said he will consider several things during the hearing, including the number of insurers actively writing coverage, market share information, economic barriers that could prevent new carriers from entering the market, market concentration, whether long-term profitability for insurers in the market is reasonable and the relationship between insurers’ costs and revenue.
Doak said he also has concerns because recent filings have not substantiated the need for increased rates. Plus, 70 percent of the earthquake insurance policies in Oklahoma the state are sold by just a few companies. He also indicated the prevalence of multi-line discounts makes it difficult for a consumer to switch carriers to get a lower price or a lower deductible on earthquake insurance.
The hearing will not be a forum to discuss complaints about denials or manmade causes of earthquakes, according to Doak’s announcement. It will be held May 24 from 8 a.m. to 10 a.m. at the Insurance Department, 3625 NW 56, suite 100 in Oklahoma City.
