From: Nigel.Allen@bbs.oit.unc.edu (Nigel Allen)
Subject: Terry Asks SCC for Rate Regulation of Commercial Liability Insurance
Organization: Echo Beach
Date: Tue, 8 Sep 1992 08:29:21 GMT

Here is a press release from the Attorney General of Virginia.
 
 Terry Asks SCC for Rate Regulation of Commercial Liability Insurance
 To: State and Business Desks
 Contact: Deboarh Love-Bryant of the Office of the Attorney General,
          804-786-2435

   RICHMOND, Sept. 4 /U.S. Newswire/ -- Attorney General Mary Sue
Terry, citing high insurer profitability and general lack of
effective competition in the marketplace, has asked the State
Corporation Commission to subject 14 lines of commercial liability
insurance to rate regulation.
   The attorney general's recommendation to the SCC was presented
in the form of testimony prefiled on behalf of her office's
Division of Consumer Counsel by consulting economist Dr. John W.
Wilson of J.W. Wilson and Associates, Washington, D.C., in
connection with the SCC's biennial hearing on the competitiveness
of the commercial liability insurance market that is scheduled for
Sept. 15.
   Under a 1987 statute originally recommended by Terry, the
SCC identified in an August 1991 report to the General Assembly,
14 lines and subclassifications of commercial liability insurance
for which it had "reasonable cause to believe that competition
may not be an effective regulator of rates." (List follows.)
Insurers writing those lines in Virginia were required to provide
special state-specific data reports to the SCC by last May 1
for use in the upcoming hearing.
   "I have been concerned for some time that Virginia businesses
and professionals may still be paying too much for commercial
liability insurance," said Terry.  "The most recent data,
unfortunately, confirms that view, and it is time for the SCC to
take corrective action," she added.
   The testimony of the attorney general's expert, Dr. Wilson,
recommends, in addition to subjecting the 14 lines currently under
consideration to rate regulation, that the SCC expand the scope of
its review to other categories of commercial liability insurance
and that it initiate rate reduction proceedings against insurers
that are earning excessively high profits.
   The Office of the Attorney General, by law, represents the
interest of insurance consumers before the State Corporation
Commission.

   Lines and subclassifications of insurance designated in the State
Corporation Committion 1991 report to the Virginia General Assembly
pursuant to Virginia Code  38.2-1905.1.B.

 Architects and Engineers Professional Liability
 Commercial Contractors Liability (Including Asbestos Abatement)
 Detective Agencies and Security Guards Liability
 Directors and Officers Liability
 Environmental Impairment Liability (Including Underground Tanks)
 Insurance Agents Professional Liability
 Landfill Liability
 Lawyers Professional Liability
 Medical Professional Liability
 Municipal Liability, including:
      Law Enforcement Agencies
      Public Housing
      Public Officials Errors and Omissions
      School Board Errors and Omissions
      Sewage Treatment Plants
 Products and Completed Operations Liability
 Real Estate Agents Professional Liability
 Volunteer Fire Departments and Rescue Squads Liability
 Water Treatment Plants Liability
 -30-

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