Insurance Regulation is Risky Business--The Case for Market-Based Regulatory Reform: News Releases: The Independent Institute

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News Release
February 4, 2013

Insurance Regulation is Risky Business—The Case for Market-Based Regulatory Reform
New book, Risky Business: Insurance Markets and Regulation, edited by Lawrence S. Powell

Feb. 4, Oakland, CA— Today, insurance regulation in the United States is at a crossroads. Some segments of the insurance industry now favor a greater role for the federal government, and although other stakeholders oppose calls to transition to a federal system, the winds of change appear to be on the horizon.

Insurance is a subject infamous for inducing apathy and acute drowsiness—except when disaster strikes, as we witnessed recently in the wake of Hurricane Sandy, and people insist that their claims be paid promptly. Then the “boring” subject of insurance becomes imbued with all of the drama that accompanies automobile collisions, fires, floods, hurricanes, and other catastrophes. Calls for reform resound across the political spectrum.

But what types of reforms would best serve the interests of consumers? And what lessons can be learned from previous reform efforts?

In Risky Business: Insurance Markets and Regulation, edited by Lawrence S. Powell, leading scholars in risk management address some of the most important questions about the future of state and federal regulation of the insurance industry. The book examines not only the impetus behind various reform proposals, but also the historical development of insurance regulation in the United States.

“Lawrence Powell has brought together a wonderful group of leading insurance and risk scholars to produce the most insightful book on property and casualty insurance industry in many years. Risky Business explains why market-based insurance should be celebrated for its innovation and competitiveness.
Roger E. Meiners, Goolsby Distinguished Professor of Economics and Law, University of Texas at Arlington

Today’s debate underscores a fundamental struggle between competing interest groups and opposing ideologies about the proper scope of government—a conflict that affects individuals’ decisions about how much risk to undertake, whether those decisions involve driving a motorcycle in dense urban traffic or building a home in a flood, fire, hurricane or other high-risk zone. It used to be a given that the insurance industry would resist efforts to move away from state-based approaches toward regulation—but no more.

To arrange an interview withcontributors to Risky Business, please contactLindsay Boyd at 202.725.7722 or [email protected]

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