With a new law, Missouri regulators may be better able to revive ailing auto insurance companies.
Online PR News – 01-October-2010 – – Missouri government officials who oversee the auto insurance market are now better able to protect consumers from financially fragile providers. A new state law that was passed by the legislature and took effect last month allows regulators to step in sooner when a coverage provider appears to be in danger of not being able to make good on all of the claims filed by policyholders.
The state department regulating Missouri car insurance companies has always been able to intervene when a provider is ailing financially. However, such action has previously only been allowed once a carrier has become insolvent (unable to pay its debts). According to John M. Huff, the director of the state's Department of Insurance, “to protect policyholders, we need to step in much sooner than that. This new law lets insurers know exactly what we’ll be looking at and when that intervention will occur.”
According to the Insurance Information Institute, regulators have three routes to choose from when there is sufficient concern that a company may become insolvent, which are placing the company into conservatorship or rehabilitation in the event that they believe the company can be rehabilitated, or, if the provider is beyond repair, liquidating its assets.
Huff says that the new law enables his department to come in to the process earlier, which may mean greater success from the rehabilitation process.
To learn more about Missouri coverage issues, consumers can go to http://www.onlineautoinsurance.com/missouri/ where visitors can also learn about finding financially stable coverage providers through the use of public rating agencies.