On April 10, 2014, the Federal Insurance Office (FIO) solicited comments relating to its authority to monitor the availability and affordability of auto insurance. Under the Dodd-Frank Act, the FIO is authorized to "monitor the extent to which traditionally underserved communities and consumers, minorities . . . and low- and moderate-income persons have access to affordable insurance products regarding all lines of insurance, except health insurance."
In the notice, the FIO states that the definition of “availability” is largely settled, but the definition of “affordability” with respect to personal auto insurance remains unclear. Last year, the Availability and Affordability Subcommittee of the Federal Advisory Committee on Insurance suggested that “affordability” should be defined as a cost that “is a reasonable percentage of a consumer’s income.” In the notice, the FIO states that measuring affordability according to that definition would be a “difficult and subjective task.”
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Topics: Auto Insurance, Automotive Industry, Dodd-Frank, FIO
Published In: Insurance Updates
DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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