Disability Law

USAToday has an article today about the increases in auto, life and home insurance premiums, brought on by loss of insurance company investment returns. Normally, when there is a downturn in the stock market and insurance companies bring in less revenue, they start talking about tort reform, and blaming their decrease in profits on trial lawyers. I guess this time everyone knows the real reason why they're not making as much money, so maybe we won't have another big tort reform push from the carriers. Here are excerpts from the article:

The cost of a typical auto insurance policy will rise 4% to $875 this year, on top of a 3% increase last year, according to the Insurance Information Institute, a trade group. Consumers also will pay more for homeowners insurance: The average policy will jump 3% to $841. And term life insurance rates are rising after several years of declines.

The price increases come as consumers struggle ? the unemployment rate has reached 8.5%, and household wealth has plunged with investment portfolios and home prices.

In this economy, "Anything that costs more is difficult for consumers," says J. Robert Hunter, director of insurance for the Consumer Federation of America.

The industry's profits come from insurance policies and investment returns, says Terri Vaughan, chief executive of the National Association of Insurance Commissioners. That's why, "If your expectations for future investment income are lower, that's going to affect premiums."

As the economy weakens, insurance rates could climb further. Insurers "cannot assume that interest rates will be much higher and stock returns much better in the foreseeable future," says Robert Hartwig, president of the Insurance Information Institute.

In the life insurance industry, weak profits, higher reserve requirements and increased capital costs are reversing a more than decade-long trend of falling term life prices, says Byron Udell, chief executive of AccuQuote, an online insurance broker.

Udell predicts average term life rates will be 5% to 10% higher at this time next year. Banner Life Insurance raised rates this year, he says. Prudential and ING have notified AccuQuote they'll raise rates in coming weeks.