Consumer Groups Challenge USAA Rate Filing

Published on

The Greenlining Institute is the most recent consumer protection
organization to file a petition with the California Department of
Insurance over a proposed rate filing by the United States Automobile
Association. Greenlining’s petition joins an earlier petition by the
Foundation for Taxpayer and Consumer Rights.

Greenlining said USAA’s filing for a 23.5 percent increase on
their homeowners multi-peril rates is too high and would negatively
affect the insurer’s policyholders, all of whom are either members or
family members of the U.S. armed forces. Greenlining also criticized
USAA for canceling more than 25,000 policies in the state.

In response to Greenlining’s statement, Roger Wildermuth of
USAA Corporate Communications said his company is committed to
providing its members with competitive rates and internationally
recognized customer service. "We have filed for a rate increase for our
California renters policies to better reflect the risk of earthquakes
and flood — as USAA is currently one of the few to provide those
coverages for renters," said Wildermuth. "We are making some
adjustments to that filing to clarify questions we’ve received, and
we’re confident that those adjustments will address those questions."

Wildermuth added that the carrier did not non-renew 25,000
members last year. "Those were cancellations requested by our members,
if, for example, they were deployed oversees or traded a renters policy
for a homeowners policy," said the USAA spokesman. "Our renters
policies actually grew by 10 and 17 percent over the last two years."

Wildermuth noted that his company has been working with the
Foundation for Taxpayer and Consumer Rights to address that
organization’s concerns over USAA’s initial rate filing.

Doug Heller, executive director for the Foundation for Taxpayer
and Consumer Rights, confirmed that his group has been in discussions
with USAA. "We looked at USAA’s original rate hike and filed a
challenge to it because we thought it was excessive," said Heller.
"After talking to us and reviewing our actuaries’ analysis, they
recognized that their rate hike proposal was too high and made
adjustments. They were very responsible and respective of California
law, and said they’d lower their request. If their final amended filing
comports with what they said they were going to do, we’re going to
withdraw our challenges."

Consumer Watchdog
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