“When admitted market bureaucracy is mind-numbing or insurance departments won’t approve anything, risk capital finds alternative product channels, which can undermine consumer interests.”
The regulatory reform question
Clark points to recent California reforms as a potential turning point. Changes that make it easier to incorporate frontier catastrophe model outputs in rate filings, and to include reinsurance costs in the ratemaking formula, create conditions in which admitted carriers can price more accurately. “Insurance departments approving methodology updates in a timeframe that keeps pace with the science” is how Clark frames the requirement for the admitted market to function as it should.
