Tag Archive for: Center for Justice & Democracy


Washington, D.C. – A comprehensive new study of the property/casualty insurance industry, How the Cash Rich Insurance Industry Fakes Crises and Invents Social Inflation, was released today. The study shows that this industry is, once again, in the process of deceiving businesses, consumers, and regulators in preparation for a national insurance crisis of skyrocketing rates, while sitting on more cash than at any time in its history.

The Consumer Federation of American (CFA) and the Center for Justice & Democracy (CJ&D) prepared the study. Written by J. Robert Hunter, CFA’s Director of Insurance, Joanne Doroshow, CJ&D’s Executive Director, and Douglas Heller, CFA’s Insurance Expert, the study exposes the industry’s long history, in the mid 1970s, mid-1980s and early 2000s of creating crises that blame lawsuits, juries, and injured victims for premium hikes even though litigation data and the industry’s own loss data show that claims were actually stable throughout each of these crises. Research has shown that rate increases during each crisis were driven by insurers’ economic cycle not spikes in insurance claims.

Co-author Joanne Doroshow said, “It is appalling that, for decades, the insurance industry has gotten away with victimizing U.S. businesses by creating crises in insurance affordability and availability, while falsely blaming juries and victims for the industry’s own mismanagement. The public has had enough of this endless cycle and the periodic crises that accompany it. We hope insurance regulators finally take some steps to reign in the excesses of the insurance industry, whose business practices are wreaking havoc on both businesses and injured victims who are falsely blamed for this.”

Click here to read the full press release.