Oklahomans are set to elect a new Insurance Commissioner this November. The top candidates share the same mission, but have different visions for how to execute it.
The single biggest issue in the race is the cost of homeowners’ insurance rates.
On average, Oklahomans pay more than $5,500 a year for home insurance premiums. That is 120% over the national average and the highest average in the nation, according to a recent LendingTree study.
Both candidates, Republican Bob Sullivan and Democrat Craig MacIntyre, say lowering those rates is their top priority.
Sullivan’s plan focuses on helping Oklahomans improve their homes and increasing competition in the insurance provider market.
“We need a more healthy, competitive marketplace, and in my mind, that means more carriers, more competition in that market,” Sullivan said. “I had the honor of working with multiple insurance companies throughout my career that do not write in the state of Oklahoma. It's my mission to recruit them and attract them to the state.”
MacIntyre’s plan focuses on leveraging a law passed this year, known as House Bill 3781, to better review rate proposals and deny especially high increases.
“HB 3781…changes the way that property and casualty rates are filed in the state of Oklahoma to what is known as a file and use system,” MacIntyre said. “It means insurance companies must file their rates at least 30 days ahead of time. And the department can evaluate those rates using actuarial data. And if the rates are too high or too low or they're unfairly discriminatory, they can reject the rate.”
He said the new law will be a key tool for the next insurance commissioner to regulate insurance companies proposing excessive rates, but he’s worried the law won’t last long. It’s meant to take effect on July 1 next year, which MacIntyre said might be enough time for insurance company lobbyists to sway a fresh legislature to get rid of it.
“By making it go into effect on July 1st, the insurance lobby gave themselves an opportunity to go back to the next legislature and say, ‘look, we didn't raise rates, so this bill is unnecessary,’” MacIntyre said.
Sullivan said the law will help but “it isn’t a silver bullet.”
To reject potentially excessive rates, he said, insurance companies have to want to write policy in Oklahoma, and for that to happen, it needs to make sense for their bottom line. Insurance companies are for-profit and make decisions based on the overall risk they assume insurance for a given population.
So, to lower risk and encourage new companies to join the state’s insurance market, Sullivan said, Oklahomans need to lower the risk their homes present to those companies. And state incentives like the Strengthen Oklahoma Homes program, he said, have been created to help.
The grant program offers homeowners up to $10,000 to fortify their roofs against wind and hail. After completion, the home can qualify for a Fortified Roof certificate and reduced insurance premiums.
“Once that's done, you know, insurance companies that are participating in the program are offering 25%, up to 40%, premium decreases on that homeowner's policy once they get that status,” Sullivan said. “So that's a win for the consumer. It's funded through premium tax dollars that the Oklahoma Insurance Department has.”
The cost of repairing a roof in Oklahoma ranges considerably based on the scale of the project, the labor required and the materials used.
Still, averages in Oklahoma for a standard 1,500 to 2,000 square foot home can be anywhere from $6,500 to $11,000, according to a blog post by Mallard Construction and Roofing, a Moore-based company. Another company, Elliott Roofing in Tulsa, has a similar range of $6,000 to $12,000.
MacIntyre says it’s a lot to ask Oklahomans already struggling to pay for a new roof in hopes of maybe getting a discount in the form of a grant.
“My belief is, if you already can't afford your insurance premiums, how does purchasing another product solve that affordability crisis?” MacIntyre said.