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Alabama has a new insurance commissioner. Gov. Bob Riley appointed former insurance industry executive Jim Ridling to the commissioner’s post, taking over for Walter Bell.
Bell, also a former president of the National Association of Insurance Commissioners (NAIC), announced in August that he was resigning to serve as chairman of Swiss Re America Holding Corp. Bell had served as commissioner since 2003.
Ridling officially began his duties on Sept. 15. Deputy Insurance Commissioner David Parsons served as acting commissioner in the interim.
Because of its location on the Gulf Coast, Alabama shares many of the insurance-related challenges also found in Louisiana, Mississippi and Florida with homeowners insurance issues remaining a top priority for the insurance department. Ridling took office in the midst of two hurricanes, the government bailout of insurance giant AIG, and an ongoing banking and financial crisis.
According to Ridling, his top priorities will be to focus on housing insurance and insurance fraud.
“Our most pressing issue is to try to do something on the coast, both in regard to availability and affordability of insurance,” Ridling says. “We have a team of people looking at what other states are doing, from Texas up to North Carolina. We want to find out what has worked and what hasn’t worked, and try to get our heads together and take the best pieces of what they have done so we can see how it will work in Alabama.”
Providing affordable insurance for Gulf residents will be particularly challenging. “The only way to tackle affordability and to be fair to the industry is probably through some kind of subsidy, whether it’s public or private,” Ridling says. “Our coastal counties provide about 30 percent of the state’s revenue, and represent 10 percent of the population. It’s an important center to the state, and being able to support the folks that live and work down there is a big issue.”
“I’d also like to see a fraud bill pass in the state of Alabama,” Ridling says. “The NAIC has a model bill, and it protects both consumers and the industry, but every time we work on a fraud bill here, it seems like a different cast of characters comes out against it.”
Ridling said he also plans to reorganize the department to improve efficiency, and would like to see the state adopt flex rating policies that would allow insurance companies to raise or lower rates (within certain parameters) without regulatory approval. At least eight other states currently operate under flex rating rules.
Arkansas-born Ridling began his career at Fireman’s Fund Insurance, and then served as president and CEO at Southern Guaranty, a Montgomery Ala.-based insurer that was later bought by Winterthur Swiss. He retired in 2003, then helped form River Bank and Trust. He has also held positions on the boards of directors for Jackson Hospital, Montgomery Airport Authority, the Montgomery Area Chamber of Commerce and the Central Alabama Community Foundation.
“Alabama has a well-deserved reputation for supporting a competitive, free market insurance environment, benefiting consumers and insurers alike,” says Cecil Pearce, American Insurance Association vice president, Southeast Region. “Commissioner Ridling’s experience in the insurance industry will serve him well in his new post.”
Ridling has had some experience working with the collision repair industry in his previous positions in the insurance industry.
“I’ve been a strong proponent of competition in parts, but you also have to provide a quality repair,” Ridling says. “Our claims department, like any other, always tried to get as much competition on the parts and repair side as possible. At the same time, we were very aware of our customer’s right to get a quality product.”
Freda Thompson, former chair of the Alabama Collision Repairer’s Association and co-owner of Ace Auto Body in Hartselle, Ala., said that repair industry groups in the state have had little interaction with the commissioner’s office in the past.
“We met with the previous commissioner a few times, and he told us there was an open door policy there,” Thompson says. “But our industry isn’t regulated by the department, and we don’t really have a say in what they do, outside of sending our customers there when they have a complaint.”
An anti-steering bill introduced earlier this year in Alabama failed to pass the legislature.
