The Georgia House of Representatives committee studying insurance rates met for the first time Thursday at the State Capitol.
The study committee is looking at ways to mitigate rising car and homeowner’s insurance rates in Georgia.
“Insurance is a major cost of living issue. It is a national problem right now, to have insurance rates that are noticeably high and increasing, and like Georgia has done in so many areas, we are trying to take a national problem and offer Georgia solutions,” Committee Chairman Matt Reeves said.
Representatives on the committee heard from several people, including Insurance Commissioner John King, a professor who studies insurance, and Georgians impacted by the increases.
In King’s testimony to the committee, he said his office is implementing fines to insurance companies that did not follow the mental health parity law, passed in 2022.
“Our office recently announced more than $20 million in fines against insurers for breaking mental health parity laws. This should not be a surprise to the industries,” he said.
King also said that fraud is a cause of high insurance costs in Georgia, and he is looking to the legislature to implement incentives to district attorneys to prosecute more cases of insurance fraud. He also praised the controversial tort reform law, which narrowly passed last legislative session.
The committee was formed after the passage of the tort reform law, which supporters like King said would reduce insurance rates.
Professor Harold Weston, the Director of Georgia State University’s Risk Management program, says it could be years until consumers see the effects of the tort reform law.
He says insurance companies face a unique challenge when setting rates.
“This is probably the only business where the business does not know what the cost of goods sold is until long after they have delivered the product,” he said.
The committee’s next meeting will be held in Savannah in September and will focus on homeowners’ insurance rates and how they are impacted by storms.
This article comes to Now Habersham in partnership with GPB News
