Special Editorial to The New Citizens Press
Give the lady credit.
That lady of course, is Gov. Jennifer M. Granholm. And the credit actually goes to the Governor and the Legislative Black Caucus for their persistence and ingenuity in trying to find creative ways to bring down the scandalously high insurance rates residents of urban areas through out the state must pay simply because of where they live.
Recently the Governor announced an initiative to reduce insurance rates in Detroit and other urban communities. If joined by the insurance industry the plan holds out much promise for insurance relief.
She was joined by members of the Legislative Black Caucus, Office of Financial and Insurance Services (OFIS) Commissioner Linda A. Watters, and Office of Community and Faith-Based Initiatives Director Greg Roberts, all of whom had been working closely with her in this effort.
Citizens long ago tired of promises made and promises not kept – or just plan having this issued ignored by previous administrations. But Gov. Granholm has set forth a meaningful, well thought-out plan, that if accepted by insurance industry could be a win-win situation for all sides.
The plan calls for the Granholm administration to help community groups and faith-based organizations to create purchasing groups that can negotiate directly with insurance companies for lower rates to garner significant savings for consumers in urban areas who voluntarily participate. Through the initiative, community groups, churches and neighborhood organizations will team up to create groups of potential customers who have good insurance claims history. The lower risk presented by purchasing group members should result in lower insurance rates than would otherwise be possible.
OFIS has sent out a Request for Information (RFI) to insurance companies designed to identify innovative ways that companies could offer insurance by grouping lower-risk individuals together. The Governor’s Office of Community and Faith-Based Initiatives will work with local clergy, neighborhood associations, and other groups to find people who fit the qualifications and form the purchasing groups. Both the RFI and report from the Governor’s Office of Community and Faith-Based Initiatives are expected back by Aug. 15th.
While any change in an industry as insular and conservative as the insurance business might automatically be greeted with skepticism, this plan needs to be embraced. It is not not nether radical nor risky – it is simply fair.
Most important, it is a plan everyone can benefit from. Responsible citizens win by having their insurance rates based on their claims and driving records – not just where they live. And the insurance companies win by getting a pool of customers they know are a low risk to insure, which means less claims and costs to them – which is why they can give a lower rates.
After years of talk and little action, Gov. Granholm, her staff and the Legislative Black Caucus have delivered a plan that can make a positive difference for people who need a break.
The ball is now in the insurance industry’s court.