Policy Documents

Efficiency Consequences of Rate Regualtion in Insurance Markets

Sharon Tennyson –
March 1, 2007

Despite the presence of many and diverse sellers of insurance in most
markets, insurance prices in some markets remain subject to regulation by state
governments. Insurance rate regulation has a long and storied history in this country
and the reasons for its continued existence are subject to debate and interpretation.
This paper critically examines the arguments for rate regulation and discusses the
consequences of this regulation for the insurance marketplace.