Obama Punches P&C In The Face - How We End Up Like Health Agents

Jan 5, 2016

  1. insurance1822
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    insurance1822 Guru

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    So I've been reading the health forums & what's happened to those guys appears to apocalyptic. Commissions drastically reduced & revenues just completely butchered. Maybe I'm also just hearing the complainers & the top dogs are still killing it?

    Here's my doomsday scenario (because we can't all think it will never happen to us..)

    America gets hit w/ 2 or 3 MAJOR catastrophe flood situations (like Katrina) that cause even more damage in a shorter period of time. Of course that would be a nightmare w/ NFIP claims & private carriers denying coverage as "flooding vs wind" and it becomes a public outcry issue overnight. That prompts the government to take "executive action to ensure the public can't be screwed by rich home & auto insurance giants again." The talk about the total profits in the insurance industries & how they're using their corporate might to get out of paying claims.

    They then mandate that all companies doing business in america MUST cover flood. The NFIP funding gets split up among carriers relative to their market share to subsidize that cost, but the funding as we all know is never enough to cover losses. The government then also FORCES P&C companies to contribute to a fund for the UNINSURED property owners to cover flooding as well. Re-insurer's want no part, or their rates become affordability high to the point that private insurers can't manage the situation & the private landscape is changed in the blink of an eye.

    The external forces are too great for regional carriers to stay afloat & the largest carriers start buying them up & commission contracts are altered to almost nothing on property lines. Profits are so dismal that insurance carriers flee to take rates on auto insurance, but the government has limited what rate increases they can take. To make the now insanely high auto insurance more affordable to everybody, the government opens a marketplace for P&C insurance that's only available directly to consumers through a portal. The government will subsidize the rates based off your income levels, but the subsidies they pay to insurance companies are too delayed & not enough to cover RISK & PROFIT. They also won't pay subsidies to company's who show a certain % profit in any one year. After the drastic mergers & acquisitions...we have a few MASSIVE carriers left that become "too big to fail..." when the next catastrophe hits...

    ...and the next one hits....

    ...Obama now runs Allstate-Travelers-Nationwide Liberty Mutual Corp who provides insurance to 99% of people. The government "creates new jobs" by making 50,000 new navigator positions to help people fill out apps. The agents going out of business don't show on jobless reports & the moron's of America praise Obama for not only making car/home insurance affordable...but creating new jobs too.
     
  2. Heather
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    Heather Guru

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    When my losses to Obama Care hit 84k I just stopped counting.

    My husband saw it coming in 2011 and told me to go into P & C, thank God I did but still I lost money, I had to let a full time health agent go, I don't want to even go into all the seniors/disabled that lost their medicare health plans 1/1/12 because medicare special needs/chronic illness plans are no longer allowed to be PPO's - only HMO's which do not work in rural areas or there is none at all. I had to personally call over 100 seniors to tell them that their advantage plan they loved so much was going away thanks to Obama care, I still remember the old ladies some of which cried over the phone to me and there was nothing I could do for them.

    I have no doubt that at some point the gov. will get into P & C as well. Some times it seems like they target industries where you can come from a humble beginning and really make a lot of money.
     
    Last edited: Jan 5, 2016
    Heather, Jan 5, 2016
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  3. djs
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    djs Super Moderator Moderator

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    Actually, the opposite of that happened in CA but with earthquake rather then flood.

    The state wanted all home carriers to offer earthquake coverage and tried to force their hand. Carriers rebelled, started moving out so the state decided they would offer it. Hence was born CEA (California Earthquake Authority).

    CEA policies are expensive and have very high deductibles. The premium is usually as much as or more then your annual home premium. Its crazy. Because of the rates, I think less than 10% of homeowners elect earthquake coverage.

    From what I understand, NFIP policies came about for similar reasons. Carriers knew better then to insure places like New Orleans. The government figured they would solve the problem.

    Dan
     
    djs, Jan 6, 2016
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  4. insurance1822
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    insurance1822 Guru

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    It's funny you mention, but I watched the movie "San Andreas" and tried to imagine what that would do to the insurance industry. That's how it came about.
     
  5. nyc2phi
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    With Bernie Sanders going after big corporations, I'm sure he'll take down the insurance industry as well..

    We're all screwed...
     
    nyc2phi, Jan 6, 2016
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  6. BigSteve
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    BigSteve Super Genius

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    It scares me that the more you post, the more I agree with you.
     
  7. Matt37
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    Matt37 Super Genius

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    Ehh.. of course never say never but the Feds have been reluctant to get involved with the P&C industry for a long time now.. they have let the states handle it.

    I mean just 3 years ago my buddy was running an RRG in NJ with only like $3M in surplus and had WAY to much risk on the books with that surplus ... NJ has now revised their RRG laws.

    But from a regulation standpoint compared to other financial industries.. the P&C industry is not bad (on the agency side) .. carrier side it is a nightmare.

    What I do see happening eventually though is WC being abolished.. no more determining if it is an occupational claim or not... it will all fall under your personal health insurance, on or off the job.

    Why your seeing a lot of these large healthcare systems dipping into the WC market... think they know eventually it will all merge.
     
    Matt37, Jan 6, 2016
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  8. agentinsouth
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    Where did you see that all co. Must cover flood? I have not see that anywhere?
     
  9. insurance1822
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    insurance1822 Guru

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    ^ yah I know..I'm just speculating how the fed COULD get into our industry and screw with it..
     
  10. Embraerjetpilot
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    Embraerjetpilot Expert

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    First off folks, our government is more than one person. Im glad conservatives have figured out that they need to fix obamacare, not just delete it... But Bernie or Donald can not just make laws. It requires congress. Now, what they very much can do is selective enforcement of the laws we have now.

    That said, World war 3 that the conservatives want to start probably would not be good for our business either.
     
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