Industry advocates: More state regulation will drive insurance rates higher

Industry advocates: More state regulation will drive insurance rates higher

(The Center Square) – Insurance industry leaders are advising Illinois lawmakers that state regulation of rates will lead to higher costs and fewer options for consumers.

The Illinois Senate Insurance Committee held a virtual subject matter hearing on homeowners and property insurance rates Wednesday.

Former Illinois Director of Insurance Nat Shapo said Illinois has sound regulation and lower rates than the national average.

“It’s not an unregulated market. Competition regulates the market. Consumers can protect themselves by comparison shopping. They do it for everything they buy in a competitive market,” Shapo explained.

Shapo said rates are higher because people have filed more loss claims.

Robert Gordon, senior vice president of the American Property Casualty Insurance Association, said Illinois has been a success story with below-average insurance rates, strong competition and market stability.

“Property losses are escalating in Illinois, like every other state, because of building inflation and climate change. Illinois homeowners insurers, though, lost money over the decade and particularly high property insurance losses in the last two years,” Gordon said.

Gordon said three things have caused increased homeowner losses: Macroeconomic issues, including 40-year high inflation and more severe inflation for building materials and labor, climate issues which include people moving into more expensive buildings in areas prone to severe weather, and costs from state government, including coverage mandates and legal system abuse.

Illinois Secretary of State Alexi Giannoulias and several state lawmakers have proposed banning insurance companies from using age, credit scores or zip codes from to determine auto premiums.

State Sen. Julie Morrison, D-Lake Forest, asked former University of Illinois Office of Risk Management and Insurance Research director Lynne McChristian if people with poor credit scores file more claims.

“That’s what the data shows. Typically, people with low credit scores are more likely to file claims. The balance on that is to say that about 70%, close to 72% of Americans have good credit, so those people get the benefit of that when an insurance score is developed,” McChristian said.

State Sen. Laura Fine, D-Glenview, suggested more government involvement.

“So much of this is clear as mud. We don’t have enough transparency. When we see the rates going up so much, people need to understand and they need to know that the state is looking out for them,” Fine said.

State Sen. Dave Syverson, R-Cherry Valley, said homeowners insurers in Illinois have been losing more money on their capitals or percentage than they are in California.

“The difference is, insurers have faith in the regulatory system in Illinois. They know, historically, it’s been working. Even though they have been suffering enormous losses over the last decade in Illinois, they believe in the regulatory system, and so they’re staying in the market. You’re not seeing the pullback like you are in the states that are regulating their market,” Syverson explained.

Syverson said Illinois has lots of options with over 1,000 insurers. He suggested it might be helpful to inform consumers and make it easier for them to compare rates.

Leave a Comment





Latest News Stories

Meeting Briefs

Meeting Summary and Briefs: Will County Board Executive Committee for August 14, 2025

The Will County Board Executive Committee received a comprehensive update on the county's expenditure of $134 million in federal ARPA pandemic relief funds, learning that 61% of the total has...
Public education budgets balloon while enrollment, proficiency, standards drop

Public education budgets balloon while enrollment, proficiency, standards drop

By Jim Talamonti | The Center SquareThe Center Square (The Center Square) – In return for soaring state spending on education, Illinois taxpayers are getting chronic absenteeism, poor academic proficiency...
Screenshot-2025-08-19-at-7.14.24-PM

Frankfort Approves Over $19 Million in Surplus Fund Transfers for Future Projects

Article Summary: The Frankfort Village Board has approved the transfer of more than $19 million in surplus operating revenues to its capital funds to finance future infrastructure projects, equipment purchases,...
frankfort-village-hall-graphic-logo.7

Frankfort Advances Plans for New Multi-Use Paths to Boost Pedestrian Safety

Article SummaryThe Frankfort Village Board has approved a $77,500 agreement with Robinson Engineering, Ltd. to design two new multi-use paths aimed at improving safety and connectivity in Main Park and...
frankfort-village-hall-graphic-logo.1

Frankfort Police Department to Purchase New Portable Radios for $31,000

Article SummaryThe Frankfort Village Board has approved the purchase of 14 new Kenwood portable radios for the police department at a cost not to exceed $31,000. The new equipment will...
Meeting Briefs

Meeting Summary and Briefs: Village of Frankfort Board for August 18, 2025

The Village of Frankfort Board leveraged a significant budget surplus at its August 18 meeting, approving the transfer of over $19 million into capital funds designated for future infrastructure, equipment,...
Plan launched to place redistricting amendment before voters in 2026

Plan launched to place redistricting amendment before voters in 2026

By Jim Talamonti | The Center SquareThe Center Square (The Center Square) – Two former U.S. Cabinet members have launched a new effort to stop Illinois politicians from drawing their...
30 charged in TdA drug trafficking, murder-for-hire and firearms offenses

30 charged in TdA drug trafficking, murder-for-hire and firearms offenses

By Bethany BlankleyThe Center Square As part of the Trump administration’s ongoing efforts to pursue violent criminal foreign nationals, two federal indictments were made public charging 30 people, including several...
White House touts D.C. crackdown; no timeline on National Guard deployment

White House touts D.C. crackdown; no timeline on National Guard deployment

By Sarah Roderick-FitchThe Center Square More than a week after President Donald Trump declared “Liberation Day” in Washington, D.C., his administration is touting the operation as a success as more...
Trump signs bill studying cancer among military pilots

Trump signs bill studying cancer among military pilots

By Zachery SchmidtThe Center Square President Donald Trump has signed into law the Aviator Cancer Examination Study Act, which seeks to address cancer rates among former and current military aircrew...
Illinois GOP U.S. Senate candidates point to economy, Trump gains

Illinois GOP U.S. Senate candidates point to economy, Trump gains

By Jim Talamonti | The Center SquareThe Center Square (The Center Square) – Economic issues are front and center for Republican U.S. Senate candidates in Illinois. Former Illinois GOP Chairman...
DOJ promises release of some Epstein records this week

DOJ promises release of some Epstein records this week

By Thérèse BoudreauxThe Center Square The U.S. Department of Justice will comply with a subpoena for records related to convicted sex offender Jeffrey Epstein as part of a congressional investigation,...
Book: Foreign countries pose greatest threat to free speech on college campuses

Book: Foreign countries pose greatest threat to free speech on college campuses

By Tate MillerThe Center Square A senior scholar at the Foundation for Individual Rights and Expression argues in her new book that the greatest threat to free speech in higher...
Exec Cmte 8.14.25.4

Executive Committee Details Spending of $134 Million in Pandemic Relief Funds

Article Summary: Will County has expended 61% of its $134 million in federal American Rescue Plan Act (ARPA) funds, with significant investments made in infrastructure, health, and economic development. Officials...
Ohio congressional districts must be redrawn this fall

Ohio congressional districts must be redrawn this fall

By J.D. DavidsonThe Center Square While politics is pushing redistricting efforts in other states, Ohio is under a rule of the people to change congressional maps before the midterm elections....