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Banking on Beacon

By: ELA (Mon, Mar/05/2007)

I’m going to go out on a limb here and suggest that when the Rhode Island Department of Business Regulation’s (DBR) hotly anticipated market conduct examination of Beacon Mutual Insurance Company comes out, it will report that the insurer was primarily at fault for shoddy documentation and not necessarily the intense wrongdoing for which it was vilified in the early months of 2006.
I could be wrong, of course. However, an insurance company doesn’t usually generally earn high praise from agents and customers by engaging in sketchy business practices. And if I'm wrong, what is the solution? The intended controls for keeping Beacon on the right path existed before the public and the body politic paid closer attention last year. That's what the DBR is for, yes?
What really needed to happen was for state regulators to examine Beacon Mutual in the context of its unique position among the nation’s insurance companies – it remains to be seen whether that’s the case with the upcoming report. The DBR was in the perfect position to analyze not only Beacon Mutual’s pricing practices, but how they compare to other insurers less in the yoke of the state. As for agent favoritism – basically every agent in the country has gone golfing on an insurance company’s dime. It may seem suspect to the public, when looking at one company, with the narrow political perspectives offered last year along with reports of Beacon’s actions. Golfing, trips, tickets – they are all industry standards.
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