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Consumer Federation of America Accuses P/C Companies of "Overcharging"

The Consumer Federation of America (CFA) has released a study it says shows that the property/casualty insurance industry has dramatically increased profits and surplus in...
January 9, 2007

The Consumer Federation of America (CFA) has released a study it says shows that the property/casualty insurance industry has dramatically increased profits and surplus in recent years by "systematically overcharging for insurance and shifting costs to consumers and taxpayers."

The study is spearheaded by perennial industry critic J. Robert Hunter, who is CFA's Director of Insurance.

"Profits and a solid insurance industry are a good thing but unjustified profits and excessive capitalization harm consumers," said Hunter, in a press release accompanying the release of his study. He went on to accuse insurers of "methodically overcharging consumers, cutting back on coverage, underpaying claims and getting taxpayers to pick up some of the tab for higher risks."

The Property Casualty Insurers Association of America (PCI) said that the CFA report mischaracterizes the facts involving the profitability of the insurance industry and the American Insurance Association (AIA) was also highly critical of many aspects of the report.

Consumer Federation: Insurers Overprice Policies (Insurance Journal 1/7/07)
 
Consumer Federation of America Press Release (CFA 1/8/07) (PDF file)

Full Text of CFA Report (CFA 1/8/07) (PDF file)

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