By Bob Weaver|
West Virginia was likely snookered by some of America's largest insurance corporations.
Charleston newspapers say "Insurance executives all over the country must be laughing about West Virginia."
During the past legislative session, Gov. Manchin and Insurance Commissioner Jane Cline, traded away West Virginians' right to sue over what is called third-party bad faith.
Now, under West Virginia law, if somebody hits your car and your Blue Book value is $10,000 but the other driver's insurance company says, "Tough. All we're giving you is $2,000," you can't take them to court.
Besides, the problem was those sue happy lawyers.
Several companies promised they would lower insurance premiums for West Virginia drivers if the state passed the legislation.
Companies such as State Farm, Nationwide, Erie, Allstate and GEICO pledged to lower West Virginia rates by a total of $50 million if state residents would give up the right to sue.
How the $50 million will be divided up among the companies and customers is unclear, but they did make the pledge, and have already lowered West Virginia rates an average of 5.4 percent, according to the insurance commissioner.
Here's the rub.
These same companies have been lowering their rates all over the USA. Pennsylvania rates overall dropped 10.28 percent since 2004.
The Associated Press just reported that major companies such as AllState, GEICO and State Farm have cut rates by at least 5 to 6 percent this year across the USA.
Cars are being built more safely, the company representatives say. There are fewer young drivers on the road, and claims are down. So premiums can be cut, they say.
State Farm lowered its car insurance rates in 32 states this year, including West Virginia.
People in those other states didn't have to give up a legal right to get lower premiums.
You may or may not find it disturbing that the West Virginia Insurance Commission was in the dark on this matter and that lobbying efforts by the insurance industry were accepted in "good faith" by the legislature.
Last year, the Legislature — with the blessing of the Insurance Commission — gave auto insurance companies the right to drop 1 percent of their customers with no explanation.
Maybe the company doesn't like that one late payment, or the age of the driver, or the color of their eyes.
When the minds of legislators begin drinking Kanawha County water, among the highest priced water in America, they slip into BFP - brain fag paralysis, listening to the hyperbole of lobbyists.
Meanwhile, the feds have made it really easy for the government to take private property for development and made it harder to take bankruptcy.