Report: Arizona’s insurance regulators lack budget funds
Often, Arizona consumers have no reasonable way of knowing that a company is not treating them right until after they have been injured financially, physically or both. Dealing with the insurance industry is no different. An insurance company could seem to be honest and eager to be there for you, only to act in bad faith when you make a claim.
Standing in between unscrupulous insurance companies and their customers is the Arizona Department of Insurance, which regulates the insurance industry in the state. But is it doing its job effectively?
A troubling report by NerdWallet suggests that the department lacks the resources it needs to address consumer complaints about insurers acting in bad faith. The site’s analysis of state budget data found that the Department of Insurance’s budget was $15.7 million in 2015, representing about 0.05 percent of the total state budget. As a share of the whole, that is below average for the U.S.; other states gave an average of 0.07 percent of their budgets to their insurance regulators.
Besides money coming from the Legislature, another potential source of revenue for the Department of Insurance is the collection of fees, penalties and taxes. But the department kept less than 3 percent of revenues last year, well below the national average of 5.98 percent.
Given that relative lack of consumer support from the government, it could feel like you are on your own after your insurer unfairly rejects or lowballs you after a claim. But you can stand up for your rights, with the support of a skilled bad faith insurance attorney.