July 30, 2002 To: Insurance Commissioners 50 states and the District of ...

5049 users shared this document! click

80 Broad Street Suite 1710 New York, NY 10004-3307 (917) 438-4608 Fax (212) 764-4298 info@insurance-reform.org www.insurance-reform.org (A project of the Center for Justice & Democracy) July 30, 2002 To: Insurance Commissioners
50 states and the District of Columbia ACTION REQUIRED BY INSURANCE COMMISSIONERS TO REGULATE INSURANCE INDUSTRY Dear Commissioner: Americans for Insurance Reform is a coalition of over 60 consumer and public interest groups,
representing more than 50 million people from around the country, that supports effective
insurance industry reforms to end the price-gouging of policyholders. We are appalled that
insurers whose own actions have created a crisis in insurance affordability and availability
for everyone from doctors and trauma centers to homeowners and motorists are blaming
others for their own mismanagement. In view of the excessive rate increases, price-gouging and tight underwriting that have hit certain
lines of insurance this year, including the homeowners and medical malpractice lines, and recent
reports about the questionable business and accounting practices of some insurers that are
intensifying the impact of the economic cycle of the insurance industry, 1 Americans for Insurance Reform believes it is imperative that insurance regulators take immediate steps to
impose a new regime of corporate responsibility and accountability on this industry whose
business practices are wreaking havoc on the American economy. This letter details our
recommendations for investigations, audits and reforms. 1 For example, on June 24, 2002, the Wall Street Journal ran a front-page investigative story that reported, among other things: Following a cycle that recurs in many parts of the business, a price war that began in the early 1990s
led insurers to sell malpractice coverage to obstetrician-gynecologists at rates that proved inadequate to cover
claims. Some of these carriers had rushed into malpractice coverage because an accounting practice widely used
in the industry made the area seem more profitable in the early 1990s than it really was. A decade of short-sighted
price slashing led to industry losses of nearly $3 billion last year. Moreover, [i]n at least one case, aggressive
pricing allegedly crossed the line into fraud. 2 INTRODUCTION Once again America faces the large rate increases and tight underwriting that accompanies the
economic cycle of the insurance industry. In the early 1990s, your organization, the National
Association of Insurance Commissioners (NAIC), studied this phenomenon and suggested ways
to ease the problem, but NAIC has not acted. We are in the midst of the cycle once more. Even
though virtually every state prohibits excessive or inadequate rates, the cycle is a manifestation
of both skyrocketing premiums (which is happening now, during the hard phase of the cycle)
and inadequate premiums (as in the late stages of the soft phase of the cycle). Stricter
regulation is necessary in order to end this destructive cycle. As usual, the American consumer is starting to pay for the mismanagement of the insurers by
being asked to pay sharply higher rates and suffer tightened underwriting rules and limits on
coverage. Meanwhile, insurance executives are pointing their fingers everywhere but at their
own actions: Regulation. As they do at each hard market, insurers are again trying to blame so-called excessive regulation even though there has in fact been too little regulation rather
than too much. The terrorist attacks. This claim is belied by the giant price jumps in lines with little or no terror exposure and for risks with terrorism excluded. Trial lawyers and the legal system. As they do each time the market turns hard, insurers are again blaming the legal system for the price jumps, as if lawyers can
miraculously engineer big awards to occur precisely as the cycle turns hard. Consumers have had enough of the insurance industry blame game and the endless cycle, with
the periodic crises that accompany it. Remedies that do not specifically address this
phenomenon will fail to stop these wild price gyrations in the future. We will suggest several
ways to reform insurance regulation later in this letter. But first, it is important to review the history of the cycle and discuss the current hard market. WE ARE EXPERIENCING A CLASSIC HARD CYCLE, WITH PRICES RISING
NATIONALLY, ACCELERATED BY THE EVENTS OF SEPTEMBER 11 TH Insurance is a cyclical business. This is particularly true in the commercial insurance business. In the mid-1970s, the country experienced the first insurance crisis. In that case, the crisis was
particularly acute in product liability insurance and medical malpractice insurance. At the mid-70s cycle low, the industrys rate of return was 2.6% in 1975, rose to 19.7% in
1977, a gain of almost 17 points in the course of only two years. The industrys rate of return 3 then fell by more than 17 points over the next 7 years to 1.9% in 1984, the nadir of that soft
market. During the subsequent hard market, profits once again shot upto 15.4% (by 1987). 2 The mid-1980s crisis was in commercial liability generally, hitting municipalities, day care
centers, environmental liability, medical malpractice and many other liability risks and lines. In
1986, Time magazine had a cover story called Sorry, Your Policy is Cancelled. 3 Two charts below show the cyclical nature of insurance. 4 The first chart, Insurance Cycle, shows the operating income as a percentage of premium from 1967 to 2001. The operating
income of the industry falls below zero four times on the chart in 1975, in 1984 and 1985, in
1992, and in 2001. INSURANCE CYCLE -10 -5 0 5 10 15 YEAR 1967 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 YEAR OP. INCOME AS % OF PREM The 1992 data point was not a classic cycle bottom, but reflected the impact of Hurricane
Andrew and other catastrophes in that year. The 1975 and mid-80s bottoms were both classic cycle bottoms with very sizeable price
increases and coverage availability problems immediately following the bottom. Consider the
mid-80s cycle turn: between 1977 and 1984, insurance premiums had actually declined (by)
4.4%from 1984 to 1987, net premiums written increased 63.3% 5 The price increases in this current cycle turn began in late 2000. 6 The rate of change was accelerating upward before September 11 th . The terrorist attacks sped up the price increases into 2 Cycles and Crises in Property/Casualty Insurance: Causes and Implications, edited by Cummings, Harrington and Klein, NAIC, 1991. Page 11. 3 Sorry, Your Policy Is Canceled, By George J. Church, Time Magazine, March 24, 1986. 4 Both of these charts use data from A. M. Best and Co., Aggregates and Averages, 2001 edition for all years except 2001, where CFA made estimates of the results based on current information. 5 Cycles and Crises in Property/Casualty Insurance: Causes and Implications, edited by Cummings, Harrington and Klein, NAIC, 1991. Page 8. 6 The Big Question For 2002: Will Hard Market Last Long? By Sean F. Mooney, National Underwriter, January 7, 2002. 4 what some seasoned industry analysts see as gouging. 7 Many examples of unjustified price increases have surfaced in the last few months. 8 9 Gouging usually does occur as the cycle turns. 10 The evidence is very strong that what we are experiencing is a classic underwriting cycle turn into a hard, from a prolonged soft, market. According to the National Association of Insurance Commissioners, underwriting cycles may
be caused by some or all of the following factors: 1. Adverse loss shocksunusually large loss shockmay lead to supracompetitive prices. 2. Changes in interest rates
3. Under pricing in soft markets 11 The NAIC does not mention the lack of intervention by regulators to keep rates from being
excessive at the hard phase of the cycle and inadequate during the latter years of the soft phase of
the cycle. Nevertheless, the unwillingness of regulators to disapprove rates that are either
inadequate despite their statutory authority to do sois also a cause of the cycle. Prior to September 11 th , the industry had been in a soft market since the late 1980s. The usual six to ten year economic cycle had been expanded by the strong financial markets of the 1990s.
No matter how much they cut their rates, the insurers wound up with a great profit year when
investing the float on the premium in this amazing stock and bond market (the float occurs
during the time between when premiums are paid into the insurer and losses paid out by the
insurer e.g., there is about a 15 month lag in auto insurance). Further, interest rates were
relatively high in recent years as the Fed focused on inflation. But, in the last two years, the market turned with a vengeance and the Fed cut interest rates again
and again, well before September 11 th . 7 there is clearly an opportunity now for companies to price gouge and its happening But I think companies are overreacting, because they see a window in which they can do it. Jeanne Hollister, consulting
actuary, Tillinghast-Towers Perrin, quoted in, Avoid Price Gouging, Consultant Warns, National Underwriter,
January 14, 2002. 8 As Insurers Hike Prices, State Regulators Consider Reducing Regulatory Authority, Consumer Federation of America, December 5, 2001. 9 Weve seen premiums go up as much as 40-70 percent, says [Jenny] Jones [CEO of Elkins/Jones insurance brokerage]. She points out that commercial buildings which now pay five or six cents per square foot for insurance
need to budget for costs to go up to as much as seven or eight cents a foot. She says the increases could be across
the board for all types of properties. Single family housing developers could be sharply affected, she notes, citing
one homebuilder whose liability premium doubled at the November 11 renewal. Large Insurance Premium
Increases in 2002 as September 11 Ricochets Through Industry, Expert Advises, Business Wire, January 3, 2002. 10 To be sure, the market began firming in 2000. But the Sept. 11 terrorist attacks sent insurance prices skyrocketing far beyond the estimates of increases that earlier were being attributed to a normal hard cycle. Year
in Review, Business Insurance, December 24, 2001. 11 Cycles and Crises in Property/Casualty Insurance: Causes and Implications, edited by Cummings, Harrington and Klein, NAIC, 1991. Page 339. 5 Inadequate insurance rates were apparent well before September 11 th . The chart, Insurance Cycle, (pg. 3, supra) shows the operating profit drop from about 13% of premium in 1997 to
about 3.5% of premium in 2000. Before September 11 th , the cycle had turned; rates were rising and a hard market was developing. An anticipated price jump of 10% to 15% in 2001 was predicted by CFA and confirmed by the
Insurance Information Institute. The shock loss was provided on September 11 th in an achingly painful way for all of America, including the insurers. However, the increases we are witnessing are mostly due to the cycle turn, not the terrorist attack
or any other cause. The price increases were sped up by the terrorist attack, collapsing two years
of anticipated increases into a few months, but the bulk of the increases are not related to pricing
for terrorism, per se. This is a classic economic cycle bottom. The question we hear a lot of debate about is how long the hard market can last. Given the
amazing inflow of capital into Bermuda and other insurance markets, seeking anticipated excess
profits, can the prices hold for long? While the jury is still out on that question, there are some factors that make it seem likely that the
hard market will be relatively brief. They include: The capital inflow in excess of the after-tax terrorism loss; The relatively overcapitalized position of the industry as shown in the chart; Leverage Ratio, on the following page; The availability of alternative risk mechanisms to the larger client risks, the insureds with the biggest price hikes; The pattern of risk managers blaming insurers, not the terrorism event or others, for renewal problems, and shopping for better deals; 12 and The easing noted in the July 2002 reinsurance renewal cycle. 13 12 Risk Managers Blame Insurers for Renewal Woes, National Underwriter, January 14, 2002. 13 See various articles in July 8, 2002 Business Insurance. 6 LEVERAGE RATIO (Target = 2.0) 0 0.5 1 1.5 2 2.5 3 YEAR 1967 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 YEAR Premium/Surplus Ratio A leverage ratio is the ratio of net premiums written (i.e., after reinsurance) to the surplus, the
amount of money the insurer has to back up the business; assets less the liabilities. Surplus is not
reserves, which are liabilities set up to cover claims. The leverage ratio has always been the key
measure of insurer strength. The rule of thumb used for decades by insurance regulators and other experts in determining
solidity is the so-called Kenny Rule 14 of $2 of premium for each $1 of surplus as safe and efficient use of capital. Some now say that this rule is antiquated, given the new level of
catastrophe possible, but new ways of spreading the risk, such as securitizing it, may offset this.
We still believe a 2:1 ratio is safe. But even those proposing a lower ratio do not propose going
below 1.5:1. The NAIC uses a 3:1 ratio as the standard for determining if an individual insurer
warrants solvency inspection. When the cycle turned in the mid-70s, the premium/surplus ratio was as high as 2.8 to 1. This
was a dangerously high average ratio since many insurers exceeded the 3:1 NAIC problem ratio.
When the mid-80s cycle turned, the ratio was as high as 1.8 to 1 a relatively safe level. In todays cycle turn, CFA projects the ratio for the 2001 year-end to be about 1.2 to 1,
extremely safe. Indeed, the industry is overcapitalized. It is particularly appalling to see insurers blame a crisis caused by insurer action on others. Take
the medical malpractice situation as an example. Rates are rising fast and the insurers tell
doctors it is the fault of the legal system, so the solution is for the doctors to go to their
legislatures and seek restrictions on the rights of their patients. Never are the doctors shown data
such as these: 14 Named after a famous insurance financial writer, Roger Kenny. 7 Had they seen these data they might realize that it would take an increase in rates of 50% to
bring them back to the rate level they had a decade earlier and that the issue was the insurer lack
of action due to high market returns on the float of the medical malpractice premium dollar, not
lawsuits! PERSONAL LINES RATES ALSO RISING Personal lines rates are also experiencing a steep jump. Auto rates have been rising fast. According to the Bureau of Labor Statistics, auto rates rose by
7.3% in 2001 and appear headed for a slightly higher increase in 2002. This compares with an
average increase of only 0.7% over the preceding three years. There has been a sudden surge in homeowners insurance prices, with insurers suddenly
imposing remarkably tough underwriting restrictions, particularly on renewal business. The
price movement has been so, high and sudden that it has caused the Governor of Texas, Rick U.S.A. AVERAGE MEDICAL MED MAL U.S.A. MEDICAL MED MAL CARE AVERAGE NUMBER OF MALPRACTICE PREMIUM SERVICES PREMIUM DOCTORS PREM EARNED PER DOCTOR CPI-U AT 2000 YEAR (in thousands) U.S.A. 7/1 OF YEAR DOLLARS 1991 631400 4862170 7700.62 176.1 11614.33 1992 652100 5138395 7879.77 189.7 11032.50 1993 670300 5174055 7719.01 202.6 10119.30 1994 684400 5931898 8667.30 212.6 10828.01 1995 720300 6080639 8441.81 223.5 10031.97 1996 737800 5992394 8121.98 231.9 9302.27 1997 756700 5917038 7819.53 238.7 8700.74 1998 777900 6195047 7963.81 246.5 8580.88 1999 797600 6155241 7717.20 254.6 8050.62 2000 812800 6375401 7843.75 265.6 7843.75 1991 to 2000 PERCENT CHANGE 50.8 -32.5 RATE INCREASE REQUIRED TO BRING 2000 TO 1991 PRICE LEVEL 48.10% Sources: Doctors USA: Statistical Abstract of the United States Earned Premiums: NAIC Report on Profit By Line By State Medical Care Services Inflation: Bureau of Labor Statistics 8 Perry, to call the top three underwriters in his state (Allstate, Farmers and State Farm) an
insurance cartel taking action to bring the state to its knees. 15 Perry is seeking to bring stronger regulation to Texas, a decision with which we heartily agree. There are reports of sizeable rate hikes in other states, as well as more sharply stringent
underwriting rules, with State Farm, for example, refusing new business in about half of the
states and imposing uniquely restrictive rules at renewal, causing a jump in non-renewals. Last year, one of the members our coalition, the Consumer Federation of America (CFA),
undertook research on homeowners insurance. Forty state insurance departments participated in
that research effort. Based upon the data the states supplied historic price levels and
profitability CFA projected that a rate increase of the order of 5 % to 7% would be needed in
2002. The Insurance Information Institute, at about the same time, put out its projection for a 6%
increase in 2002. Rates are going up by about twice that rate, however. Here are some of the findings of the CFA study: 1. In 1999, the average increase in the 20 states reporting numbers was 2.6%. In 2000, the average increase in the 25 states reporting a figure was 3.1%. On an annualized basis, the
increase in 2001 figured to be about 6.5%. While the 2001 change was larger than in recent
years, the increase appeared to be reasonable. 2. The largest rate changes reported in 2001 were in the states of Indiana (about 12%), Kansas, Maryland, Missouri and Wisconsin (about 9%), Montana (about 8%) and Arizona,
California, Delaware, Nebraska and New Jersey (about 7%). 3. The smallest rate increases were reported in Hawaii (a reduction), North Carolina (no change), Mississippi and Pennsylvania (1% to 2%), South Carolina and Vermont (about 2%)
and Colorado, Florida and Kentucky (3% to 4%). Although non-specific as to the
percentage, small increases were also reported in Massachusetts and Oregon. 4. Indiana, Oklahoma and Wyoming said they had no information on rate action and Rhode Island advised that it had insufficient resources or tools available to track the information
requested. 5. States that commented on the cause of any observed higher change in homeowners rates in 2001 credit lower investment income in 2001 and higher claims costs recently, the latter
often related to catastrophes. Some states said homeowners insurance had been a loss
leader or accommodation line used to get auto and other sorts of policies on the books
while auto and these other policies were extremely profitable. Now that these lines have 15 Texas Governor Blasts Homeowners Insurers, Suggests Reforms, BestWire, May 17, 2002. 9 returned to normal profitability, the homeowners line must be increased to carry its own
claims expectations. Only one state cited mold as a problem as of late 2001. 6. The Insurance Services Office (ISO) recommended changes in loss costs of about 2.7% in 1999, 4.6% in 2000 and 1.1% for the first 9 months of 2001 (the latter figure is a good
estimate for full year 2001 since it includes pending changes). Thus, industry price changes
apparently exceeded the change in underlying losses throughout the test period, perhaps
confirming the notion that homeowners insurance was a loss leader earlier in the decade. 7. A few states (8) commented on coverage restrictions. Those that did tended to be from wind/hail prone states. Deductible increase was the most mentioned restriction. According to the NAIC Report, Profitability by Line by State in 2000, homeowners insurance
profitability nationally over the last 5 years has been: RETURN ON YEAR NET WORTH 1996 -4.2% 1997 12.4 1998 5.4 1999 5.4 2000 3.8 AVERAGE 4.6% One possible source of the problem is the remarkable activities of the leading writer of
homeowners insurance, State Farm. About a year ago, in his annual letter to shareholders,
financier Warren Buffett complained that State Farm was inappropriately holding prices below
cost in an attempt to maintain market share against the onslaught of the more efficient (direct
writing) insurance companies. Buffetts warning came home to roost this year as State Farm
reported an underwriting loss of $9.3 billion, causing S&P to cut the insurers rating to AA+
from AAA (not because of low surplus, which remains excessive, but because of the bad one-
year result). We believe it is wholly inappropriate to visit insecurity and shock price increases on State
Farms policyholders because the companys business plan was so flawed that Mr. Buffet railed
against it in early 2000. We believe that insurance commissioners have a duty to see that the
insurer does not overreact by not writing new business in several states and by adopting
draconian underwriting rules for renewal business (such as recently reported in the Wall Street
Journal), where the mid-Atlantic state rule was stated to be two claims in a three-year period. State Farms actions, given its immense size (over 25% of the market in many states), opens the
door to massive price increases for at least two key reasons: 10 Other insurers will feel free to move as the market leader leads the pack upwards in price indeed, as you may know, many tie their rating strategy directly to State Farm; and The refusal to write new business and the jump in State Farm non-renewals will add pressure to the demand and prices will be raised as a result. HOW SERIOUS OF A PROBLEM IS THE CURRENT CYCLE BOTTOM? This cycle bottom is nowhere near as severe in the fundamentals as previous bottoms: Today, the net premium to surplus ratio is 1.2 to 1. Compare that to the mid-1980s bottom where the ratio was 1.8 to 1 and the mid-1970s bottom at 2.8 to 1. The crisis rests significantly on a jump in loss reserves of $16 billion in 2001. The positive cash
flow in 2001 was a remarkable $13 billion (compared to only $9 billion in the profitable (albeit
low profit) 2000 year. 16 The jump in reserves is typical of the cycle bottom. Reserves often need to be released to profits later in the softer market years, history reveals. This years crop of
reserve jumps is very odd indeed. Consider the following table: 17 Claims 2001 Claims 2000 Percent Line of Business $Mil $Mil Change ----------------------------------------------------------------------
Products Liability-
Claims Made 213.6 0.9 23,325.1 Earthquake 875.0 171.8 409.3 Products Liability-
Occurrence 2,842.8 971.6 192.6 Medical Malpractice-
Claims Made 5,789.2 2,799.5 106.8 Homeowners 44,862.3 21,874.8 105.1 Personal Auto 89,861.3 51,045.3 76.0 Workers' Compensation 30,563.5 17,553.5 74.1 Auto Physical Damage 64,713.1 37,665.3 71.8 Commercial Auto 16,859.8 10,300.3 63.7 Commercial Multiple
Peril 22,051.1 12,693.5 73.7 Medical Malpractice-
Occurrence 1,928.9 1,811.5 6.5 These incredible leaps in losses must be examined. It makes no sense for claims to jump so
severely in stable/staid old lines like homeowners and personal auto. The accounting for these
losses is questionable. 16 See, Shoebox Accounting has Blind Spots, Mooney, National Underwriter, June 24, 2002. 17 Press release from Weiss Ratings, Business Wire, July 8, 2002. 11 WHAT STATE REGULATORS SHOULD DO 1. Investigations and Audits There must be a full and thorough investigation of the insurance companies data to determine if
there are errors and over-reserving in the data. In particular, we are asking that you order an investigation to determine: The extent to which the extraordinarily high profitability of the insurance industry during much of the 1990s, and its lower profitability today, is related to the performance of
interest rates and the stock market during those periods; The extent to which todays rate increases are an attempt to recoup money that insurers lost in the stock market or in other poorly-performing assets; The extent to which insurers are adversely affected by todays low interest rates; Whether insurers estimates of their future claims payments, which are the basis for rate increases, are unreasonably high today; and Whether it is proper, or lawful, for insurers to seek substantial rate increases despite having hugely increased their surplusthe money they have in the bank, with
policyholder-supplied funds, particularly if the insurer is overcapitalized. In addition, we urge you to institute, or seek statutory authority to institute, annual, rather than the typical once-every-three-years, audits of insurance companies operating in your state.
These annual audits, we believe, should ascertain whether the companies are engaging in
questionable accounting practices and whether their business and investment practices, by failing
to take into account cyclical economic downturns, present unacceptable financial risks for
insurance consumers and shareholders. 2. Specific Reforms a. Regulate excessive pricing. One cause of the cycle is the lack of regulatory action to end excessive and inadequate rates during the different phases of the
cycle. Please start now by regulating the excessive prices being charged by
insurers today in your state. At least hold the necessary hearings to determine if
the prices are not excessive. b. Advise your legislators that the solution to prevent shock rate increases such as we are now experiencing is insurance reform, not tort reform. c. Freeze particularly stressed rates until the examination of the prices and remarkable jumps in loss reserves can be fully analyzed. For instance, medical malpractice and homeowner rates should be frozen. A roll back of
unjustified rate increases that have already taken effect should then be in order.
(The manner in which insurance rate rollbacks can be written and implemented to 12 comply with all Constitutional requirements is explained in Calfarm Ins. Co. v.
Deukmejian, 48 Cal.3d 805 (1989), and 20 th Century Ins. Co. v. Garamendi, 8 Cal.4th 216 (1994). These cases substantially upheld Prop 103, the California
insurance reform initiative that rolled back auto insurance rates by 20%.) d. Require that risks with poorer experience pay more than good risks in lines of insurance where such methods are not in use today. For example, require medical malpractice insurers to use claims history as a rating factor, and to give
that factor significant weight. Auto insurers use an individuals driving record as
a rating factor; workers compensation insurers use the employers loss experience
as a rating factor so-called experience mod. Malpractice insurers should do
the same. In addition, you should require all medical malpractice insurers to offer
all good doctors i.e., all doctors meeting an objective definition of eligibility
based on their claims history, their amount of experience and perhaps other
factors the lowest rate. e. Reduce the percentage of assets that insurers can invest in stocks or other risky assets. Insurers should not be permitted to raise their rates in order to recoup losses on stocks or other risky assets. The less risky their investments, the
more secure policyholders are, and the more stable are rates. f. Create a standby public insurer to write risks when the periodic cycle bottoms and hard markets occur, such as a medical malpractice insurer
funded by a start-up loan from the state to compete with the existing
malpractice carriers. Several states have created such carriers to write workers compensation, and in many states such carriers have helped bring down workers
comp rates. Similarly structured medical malpractice insurers should have similar
success. g. More strongly regulate auto and homeowners insurance to prevent shock price increases and insecurity for policyholders. For example, you must prevent insurers, like State Farm, from overreacting by not writing new business
in some states and by adopting draconian underwriting rules for renewal business.
If the rate increases are shown to be high due to corporate policy (such as State
Farm holding down prices as a marketing strategy), prices should not be allowed
to go up suddenly but be spread over at least a three-year period to avoid sticker
shock for your states citizens. h. Ask NAIC to stop implementation of the deregulation of commercial rates and forms which NAIC is unwisely pushing at this time. Oppose the implementation of such deregulation in your state. The vast majority of American consumers, businesses and professionals make a considerable annual investment in insurance coverage to protect them against unanticipated
losses. As the official charged with regulating the insurance industry and protecting the interests
of insurance consumers in your state, you have a unique and pressing obligation to take steps to
reform regulation of the insurance industry, which consistently looks for scapegoats to cover up
its own mismanagement and the results of its own economic cycles. 13 Thank you for your time and consideration. Please do not hesitate to contact us with any questions. Sincerely, J. Robert Hunter On behalf of Americans for Insurance Reform: Alabama Watch, AL
Arizona Consumers Council, AZ
Boston Womens Health Collective, MA
California Advocates for Nursing Home
Reform, CA
Caribbean Womens Health Association,
Inc., NY
Center for Economic Justice, TX
Center for Insurance Research, MA
Center for Justice & Democracy, NY
Citizen Action/Illinois, IL
Citizens Committee to Protect the
Elderly, VA
Citizens Environmental Coalition, NY
Citizens for Consumer Justice, PA
Coalition for Consumer Rights, IL
Colorado Progressive Coalition, CO
Colorado Public Interest Research
Group, CO
Community Food Resource Center, NY
Concerned Citizens of Clarence, NY
Connecticut Public Interest Research
Group, CT
Consumer Federation of America, DC
Consumers for Civil Justice, NJ
Consumers United/Minnesotans for Safe
Foods, MN
Cornerstone, MN
Dalkon Shield Information Network, PA
Democratic Processes Center, AZ
DES Action, CA
Jennifer Dingman, PULSE of Colorado*
Disabled in Action of Metropolitan New
York, NY
Empire State Family Farm Alliance, NY Families Advocating Injury Reduction,
IL
Families for Improved Care, OH
Florida Public Interest Research Group,
FL
Foundation for Spinal Cord Injury,
Prevention, Care and Cure, MI
Foundation for Taxpayer and Consumer
Rights, CA
Free Hand Press/Mouth Magazine, KS
Georgia Public Interest Research Group,
GA
Good Old Lower East Side, NY
Gray Panthers National Office, DC
Headway for Brain Injured, Inc., NY
Illinois Public Interest Research Group,
IL
Indiana Public Interest Research Group,
IN
Joint Public Affairs Committee for Older
Adults, NY
Massachusetts Public Interest Research
Group, MA
Mental Health Association of New York
State, Inc., NY
Michigan Consumer Federation, MI
Minnesota Consumers Alliance, MN
Regene Mitchell, Consumer Federation
of California, CA*
National Gay and Lesbian Task Force,
DC
National Womens Health Network, DC
New England Patients Rights Group,
Inc., MA (continued on next page) 14 New Hampshire Public Interest Research
Group, NH
New Jersey Public Interest Research
Group, NJ
New Mexico Consumer Action, NM
New York Public Interest Research
Group, NY
New York StateWide Senior Action
Council, NY
North Carolina Hunger Network, NC
North Carolina Public Interest Research
Group, NC
Oregon Consumer League, OR
Oregon State Public Interest Research
Group, OR
Patient Information Alliance, NY
Patients Rights Advocacy, WA
Pennsylvania Consumer Council, PA
Pennsylvania Public Interest Research
Group, PA
Peoples Medical Society, PA Public Interest Research Group in
Michigan, MI
Rhode Island Public Interest Research
Group, RI
SafetyForum.com, VA
Senior Action in a Gay Environment/
Queens, NY
SmokeFree Educational Services, NY
Texans for Public Justice, TX
Texas Watch, TX
USAction, DC
U.S. Public Interest Research Group, DC
Utah Citizens Alliance, UT
Vermont Public Interest Research
Group, VT
Washington Public Interest Research
Group, WA
West Virginia Citizen Action Group,
WV
Woodstock Institute, IL * Organization listed for identification purposes only. Americans for Insurance Reform (AIR) is a project of the Center for Justice &
Democracy. Endorsement of the AIR project does not imply endorsement of other
programs of the Center for Justice & Democracy.

Comments