It’s David vs. Goliath.
That about sums up California Insurance Commissioner Dave Jones’ feelings on his efforts to keep the remnants of Obamacare up and running in his state while President Trump does his best to repeal and replace it.
“I feel like a kid with a finger in the dyke as the president’s taking a big wrecking ball to the dyke,” Jones told an audience of insurance professionals and students at an insurance forum on Monday.
He said Trump is “trying to sabotage healthcare” by attacking individual mandates, the open enrollment period and the exchanges themselves.
The forum was hosted by the Center for Insurance Studies, which is part of the Mihaylo College of Business and Economics at Cal State University Fullerton. The center regularly hosts speakers to bring together the insurance community. Last year actor Arnold Schwarzenegger and Robert Hartwig, former economist and president of the Insurance Information Institute, headlined the forum.
Jones was joined by representatives from the Orange County District Attorney’s office to speak about fraud, and an executive panel discussion on insurtech that included Jamie Hale, CEO and co-founder of Ladder Life Insurance, David Loughran, co-founder and chief economist of Praedicat Inc., and Dr. Tadashit Funahashi, chief innovation and transformation officer and assistant regional medical director for Kaiser Permanente Southern California.
Jones, who is running for the state office of Attorney General in the 2018 election, hit on just about every subject the California Department of Insurance deals with that he could address in a nearly hour-long speech.
He talked about his support for the National Association of Registered Agents and Brokers and the department’s efforts to make getting insurance agent licenses easier in California, dealing with ridesharing and the growth in the number of carriers writing rideshare insurance, cybercrime, fraud, wildfires, marijuana insurance, insurtech and autonomous vehicles.
He addressed concerns that autonomous vehicles will bring about the end of California’s auto insurance consumer protection law, Proposition 103, as cars do more of the driving and insured drivers do less, potentially rendering the law obsolete. Some consumer advocates worry that the insurance and auto industries will use autonomous vehicles as a reason to do away with Prop. 103.
“We’re confident that Prop. 103 has sufficient protections,” Jones said.
However, he acknowledged that there will likely be a time when the at-fault aspect of the law that governs rates will have to be examined.
“At some point in the future … then we will have to take a look at these regulations,” he said.
Jones, a staunch advocate of combating climate change who has pushed efforts to get insurers to disclose their coal investments, said global warming has increased wildfire risk in places like California and that he’s concerned that carriers will stop writing in wildfire prone areas.
He said the department has already begun seeing carriers curtail writing insurance in some of the state’s riskier foothill areas.
“We’re seeing some pullback by insurers in some parts of the state,” Jones said.
He said the pullback hasn’t yet impacted the FAIR Plan Association, the insurer of last resort for residents unable to find coverage through other insurers. The FAIR Plan provides basic coverage for fire up to $1.5 million for a structure and its contents.
But, he said he’s worried that when insurance for homeowners becomes increasingly harder to find, political pressure will mount and force the Legislature and the state’s insurance community to square off.
“It’s something that we’re monitoring,” he said.
Jones was high on a new law that enables Californian’s to light up cannabis for recreational purposes, which he believes presents an opportunity for the industry.
He encouraged insurance professionals to consider getting into marijuana insurance because there isn’t enough insurance or insurance pros to go around who specialize in this.
He estimated there are roughly 25 surplus lines insurers working on supplying coverage to various parts of the cannabis supply chain.
“Increasingly, this is a very, very well financed and capitalized industry,” Jones said.
He encouraged any insurance carriers listening to file products catering to the marijuana industry and he indicated they wouldn’t have much trouble getting rates approved because there’s currently not enough history for the department to debate rates.
“We’re going to pretty much accept what you file with us,” Jones said.
He added: “As your regulator, I would encourage you to get in. It’s a growing industry.”