>>>Tort reform would have to be at the national level to help. Most insurance companies are national, not state limited, and have to deal with all the states when setting rates.

It is true that there is nothing like a Glass-Steagle act (prohibited multistate banking) that limits multi-state insurance companies, it is *not* true that states defer to the Fed to regulate insurance. Every state that my company does business in (OR, CA, NV, WA, & AZ, at present) has their own department of insurance (DOI) and a long list of laws and rules regulating how insurance is sold, priced, and how payouts must be made in that state. To do business in a state at all, a company has to file a request with the DOI. A company can't even change its rates without asking for permission.

>>>At present, lawyers gravitate to "lawsuit friendly" states to rake in their cash from bogus lawsuits. A law passed in California that just took effect opens gun companies here up to more lawsuits, and the lawyers are going to descend here like flies to a dead pig.

I can't comment about what will happen in CA concerning a new plague of lawyers attracted by this law you reference (how can you cite a prediction of a future event to support an argument, Tom?). But I can tell you that if any such effect had happened in regards to insurance law suits, it would have shown up in the studies. Since it did not show up in the studies, there was no such effect.

>>>The damage being done to our economy by a near-psychotic lawsuit feeding frenzy is immense. Tort reform should be a top priority for any administration, but since the trial lawyers pretty much call the shots in Washington (number 4 among all political donors), I don't look for many changes soon.

Sorry I didn't go to your link. Is it relavent to insurance premiums?

>>I am interested in the correlation between interest rates and insurance rates. Why would this be so?

It would be so because insurance companies operate very much like banks do. They have to maintain a large reserve to cover any forseeable payouts (and there are DOI regs about this too). To a very large extent, an insurance co's profitability (and a bank's) depends on how efficient a use can be made of this cash that otherwise would just sit there. It is typically stored in a large number of financial instruments. Bonds and other instruments that are quick to liquidate are usually mandatory.

[On a personal note, I am invested heavily (IRA account) in common stock of a Florida insurance company (TCHC, if anyone cares). I recently got a bit clobbered when it turned out that one of their investments was in WorldCom bonds.]

So when the market goes South, and interest rates are low, and bond returns are low, insurance company profitability suffers. And they increase premiums to make up the loss. [And they start complaining about lawsuits.]

Here's some info about one study that sought a correlation between torte reform and insurance premiums.

Another study that compares insurance premiums to payouts, and to the economy.