Time is short for me today but one thing that stood out in the State Farm rate increase application was the use of models to calculate the cat risk assumptions that drive the rate up (and the rate app is woefully short on the assumptions used in these models). In Florida Allstate used very short term models that have proven highly inaccurate to justify rate increases there that Commissioner McCarty turned down. Additionally I highly recommend you contact Beatrice Garcia of the Miami Herald as she reported extensively on the use of those unapproved models back in early 2008. I’d also track down Karen Clark, the person who pioneered the use of weather modeling for insurance for additonal info. You guys need facts, not industry spin to challenge Mike Chaney and this bogus rate up from State Farm.
Weather modeling posts we’ve done on Slabbed:
How’s the weather model – December 2007
Insurance Weather Modeling – Others have questions too – December 2007
On the fallacies of the science behind statistical modeling – April 2008
Sam Friedman does some of his best blogging on the topic of bogus weather modeling – April 2008
Weather modeling pioneer Karen Clark slams the use of short term models – December 2008 (Related PDF from Karen Clark and Associates)
Arm yourselves with knowledge and the good questions and solid reporting will naturally follow. Jackassery and puff reporting will be dealt with in detail and harshly. These crooks from Bloomington have crushed the coast to the breaking point and the media has a chance to shine here, please don’t blow the chance. We’re not scared of the answers here at Slabbed, you just gotta know the right questions to ask.
I’ve sent the rate request out to our own expert sources for evaluation and will post more about this when we learn more.
One thought on “Attention Mississippi Coast Media: Yes Dave Elliot and Doug Walker you guys too”
Very good post.
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