Insurance executives rake in hundreds of thousands as premiums proceed to rise – CFA

A current overview carried out by the Consumer Federation of America (CFA) has make clear the substantial compensation acquired by CEOs within the nation’s high 10 private traces insurance coverage corporations.

At a time when rising insurance coverage charges are inflicting monetary pressure for policyholders throughout the United States, the CEOs of main insurance coverage companies have been incomes substantial salaries, bonuses, and extra funds.

According to a information launch, the Consumer Price Index for August highlights a 19% enhance in auto insurance coverage prices in comparison with 2022. Meanwhile, the CEOs of six main insurance coverage corporations acquired compensation exceeding $12 million every in 2022. In complete, these high 10 insurance coverage executives had been paid over $130 million in the identical 12 months, with mixed earnings over the span of two years amounting to $253,493,931.

The compensation figures for insurance coverage executives in 2021 and 2022 had been obtained from Nebraska’s Department of Insurance, which mandates insurance coverage corporations to reveal data concerning salaries, bonuses, and different compensation for his or her high officers. However, CFA additionally famous that these reported figures might underestimate the precise earnings of executives, as they may exclude compensation from affiliated corporations.

CFA additionally noticed that these extreme compensation for insurance coverage executives coincided with the burden confronted by prospects and staff attributable to stringent fees imposed by these corporations. The federation cited these examples:

• Farmers’ government Jeff Dailey acquired a virtually $2 million increase in 2022, whereas the corporate elevated owners insurance coverage premiums by over $575 million throughout 42 states, restricted availability in California, halted renewals for nearly a 3rd of its owners insurance coverage insurance policies in Florida, and laid off 11% of its workforce
• Liberty Mutual paid its CEO, David Long, over $15 million in 2022 and lately raised owners insurance coverage charges by $729.8 million
• State Farm compensated its CEO, Michael Tipsord, with over $24 million whereas elevating auto insurance coverage charges 4 occasions in a 12 months in its residence state of Illinois, growing auto charges by 17% in Louisiana, and elevating owners insurance coverage charges by 28.1% in California, alongside halting new purposes for owners insurance coverage in California

“CEOs are living high on the hog while increasing insurance premiums for people living paycheck to paycheck,” mentioned Michael DeLong, analysis and advocacy affiliate at CFA. “Insurers are telling regulators that ordinary consumers have to pay much more for auto and home insurance because the companies are struggling with inflation and climate change, but they are quietly handing CEOs gigantic bonuses. Drivers are required to buy auto insurance and homeowners have to buy coverage to satisfy their loan requirements, so there needs to be more scrutiny of the rate hikes companies are demanding and the huge CEO paydays that are funded with customer premiums,.”

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