Large-Deductible Rules Proposed to Protect Against Insolvencies

The California Department of Insurance is proposing rules to establish credit and collateral requirements for insurers writing high-deductible policies, saying questionable underwriting practices have resulted in insolvencies costing California’s guaranty association at least a $250 million. Carriers would be required to maintain a specified credit rating and minimum surplus to write high-deductible policies. Carriers that don’t have the sufficient credit rating or capital could still write high-deductible policies if they collateralize the deductible amount. The depart...