You are here:HomeIssuesHealth Care Reform2013NY Regulator: Obamacare Works So Well, Use It as Model for Homeowners

NY Regulator: Obamacare Works So Well, Use It as Model for Homeowners

Benjamin Lawsky, superintendent of the New York Department of Financial Services, called for the standardization of homeowners insurance so that consumers would no longer be “confused” about what the policies cover...
October 3, 2013

Benjamin Lawsky, superintendent of the New York Department of Financial Services, called for the standardization of homeowners insurance so that consumers would no longer be “confused” about what the policies cover. According to Lawsky, few policyholders fully understand all the details of their coverage, and an increase in uniformity would make it easier for consumers to compare policies offered by competing insurers. Lawsky said that the new approach to the sale of health insurance under President Obama’s healthcare reform suggests that homeowners coverage should be sold in the same way.

What It Means to Agents: It is nothing short of incredible to think that anyone would seriously suggest that homeowners insurance be structured along the lines of Obamacare! First, with the health insurance exchanges barely opened, no one should be declaring the government’s foray into private sector health insurance a success. To declare it a success on Day One, then recommend that the same thing be done to private sector homeowners insurance, is mind-boggling.

Such a move would transfer a wide swath of the insurance business — and state courts’ common tort and contract law authority — to federal control. It would expand the involvement of the federal government to encompass property insurance. It is also of questionable constitutionality. The bottom line question all of us must ask in response to Mr. Lawsky’s proposal is: Do we really wish to gradually turn over ever-larger pieces of the private sector insurance industry to the federal government? That is precisely what is being proposed here.