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How is the insurance industry held accountable to protect policyholders?
Jeff Ryan - CLU, ChFC, AIA, CIC, CPCU
January 21, 2025
Many don’t realize that the insurance industry is one of the country's most regulated business segments, especially in New York State. The New York State Department of Financial Services (NYS DFS) wields significant control over the insurance business and has a stated goal of protecting consumers.
But what authority does the NYS DFS actually have?
- Rate Approvals:
- It’s a little-known fact that the NYS DFS reviews every company’s rate change requests. They review those requests for actuarial reasonableness, ensuring they are not excessive, inadequate, or discriminatory. The DFS review includes rates for all lines of insurance, including auto, home, business, health, and life insurance.
- Regulatory Oversight:
- Supervision to make sure insurance companies and their representatives comply with state laws and regulations
- Licensing & Continuing Education:
- The NYS DFS tightly controls the licensing process to ensure only capable and trustworthy agents and companies operate in the state. This is part of their commitment to consumer protection.
- Monitors and requires continuing education for licensed agents.
- Policy Language Suitability.
- Another crucial role of the NYS DFS is to ensure the suitability of policy language. Insurance companies must submit their policy forms and guidelines for approval before using them in their policies. This approval process, overseen by the DFS, prevents the use of inappropriate coverage forms that could disadvantage consumers, thereby ensuring the security of your insurance policies.
- Consumer Protection & Education:
- The enforcement of laws and regulations protects consumers from nefarious schemes and unfair trade practices.
- Provides a mechanism for consumers to submit complaints when there are disputes with representatives and carriers.
With recent events, some may be concerned that the insurance industry operates without much oversight. The opposite is the case. New York State has a reputation for being strongly pro-consumer and a challenging environment for insurance companies and agencies. All with the stated purpose of protecting the consumer.
This article may have been originally published at Quora.com.
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“Am I covered if I drive someone else’s car?” Or, “Am I covered if someone else drives mine?”
Most property insurance companies offer Actual Cash Value or Replacement Cost settlement options. Typically, insurance companies will require that you insure the property to the settlement value you choose. If you select Actual Cash Value, the amount you may be required to insure the property for will be less than the corresponding Replacement Value.
In that spirit, the Ryan Agency is sponsoring a Stearns BBQ Dinner pickup at our office on 57 Broadway Mall in Hornell on September 12th from 3:00 PM to 4:30 PM.
Today, an individual’s credit history can play a more significant role than any one of those traditional factors. Good Credit Scores lead to a Positive Insurance score. A good Insurance Score greatly influences what someone will pay to insure their vehicles.
Insurance companies offer various discounts for which their policyholders may qualify.
Great Eight number Six (6) suggests taking a look at removing Comprehensive and Collision on Older Vehicles.
By reducing the number of claims in your insurance history, you can significantly affect your rates in the future.
Sometimes, this concept meets with resistance from policyholders. The thought of paying more in the event of a claim is off-putting to some. Even if that means I pay more for my insurance.
OK. Admittedly, this strategy doesn't benefit everyone, but it can be very beneficial for those it does. You may have unique home or auto insurance needs that prevent you from bundling with the same company. Alternatively… you might have a better rate without the bundle discount by splitting up your insurance between multiple carriers.
In recent years, companies have implemented discounts for paying insurance policies in full (or annually) for some types of insurance. Many companies offer this option, especially for their auto policies.
