Thank you for enjoying our insurance guide! For more information, including sources and backup, see How the Cash Rich Insurance Industry Fakes Crises and Invents Social Inflation (March 2020). Written by Joanne Doroshow, Executive Director, Center for Justice & Democracy. Illustrations by Jason Stout, Austin, Texas. For questions, please contact:... Continue reading

When Words Aren’t What They Are Insurance words are more like terms of art. A special kind of art. Like the fraudulent kind, sold to you by a dealer who told you it was something it wasn’t and then charged you full price. Here are some favorite examples: Incomprehensibly Comprehensive... Continue reading

No One’s Watching Government oversight over insurance pricing and coverage barely exists. Insurers mostly do what they want. Congress has prohibited any federal regulation of insurance. It delegated insurance regulation to the states, with no standards and no oversight. Most state insurance departments have weak or non-existent authority over insurance... Continue reading

Anyone Else Would Go to Jail For insurance companies, price-fixing (coordinating with others as to what they’ll charge you) is perfectly legal. They collude, and you get price-gouged. For any other industry, this would be a crime. In 1944, Congress passed the McCarran-Ferguson Act, a law that exempts the insurance... Continue reading

Party Like It’s 1999 When the industry complains that claims have increased, it never adjusts its data for inflation or population, masking the fact that adjusted claims have been stable for decades. Since 1999, total commercial insurance payouts have never spiked and have generally tracked the rate of inflation and... Continue reading

Hiding Wealth with Tricks and Loopholes When the insurance industry says it’s suffering losses it’s usually massively prospering. When the industry argues that it needs to raise rates or else it will risk financial peril, this is easily proven untrue. For example, while recently arguing for rate hikes, insurers’ surplus... Continue reading

A Loss is Not a Loss When insurance companies say they’ve lost money, they haven’t. It’s just an accounting trick. The unique accounting practices of the insurance industry allow companies to identify “losses” that are not really losses at all. To an insurance company, the word “loss” is short for... Continue reading

Crying All the Way to the Bank How do insurers make money? By pocketing and investing the premiums you pay them. Insurers make their money primarily from investment income, investing the premiums they receive from policyholders. In fact, in only a quarter of the last 50 years have insurers achieved... Continue reading

The property/casualty insurance industry is one of the most important yet least understood industries in the nation. Every person and business in America needs insurance but few understand how it works. As a result, the industry can make extraordinary claims and demands on policymakers – and policyholders – that go... Continue reading