It’s a well-established fact most people don’t like insurance companies. Many people believe Insurance companies are out to get more then they need. Some people think insurance companies use mysterious methods to reach into the pockets of unsuspecting people and take money for unknown reasons.
So it should be no surprise that the democratic tax and spend Governor of the state of Oregon, Ted Kulongoski (pronounced as: Governor “Tax And-Gouge-Me”) has decided insurance companies may as well do the dirty deed and collect some of the taxes to pay for services most people would assume should be covered by their horribly outrageous income tax and property taxes in Oregon.
It seems the only thing worse then an Insurance company is a government that hikes taxes so Ted Kulongoski has decided to hide behind the thing most people already mistrust and don’t like–Insurance companies. It didn’t take a month from the reelection of the Oregon Democrat Governor to announce his new method of taxation: Let the Auto Insurance companies add the tax to fund the State Police…
On December 6, 2006, Ted Kulongoski announced his newest tax and spend idea to provide a stable funding source for the Oregon State Police. His wonderful idea of a stable funding source is to add a surcharge on car insurance premiums. Of course, the Governor cares for the poor and those who can only afford the minimum liability limits so only those policies with limits beyond the mandatory minimum coverage would be assessed this tax to pay for the State Police.
Instead of taking the heat for inventing a new tax, the Oregon Governor will pass that on to the already hated insurance companies. The sad truth is this isn’t the first tax idea proposed or passed in Oregon where the insurance companies are forced to become the tax collectors of the state.
Another reach to into consumers pockets by the Oregon government came in 2004 when many insurance companies in Oregon were forced to add a surcharge to most property and casualty policies sold in the state. Insurance companies are using this surcharge to recover assessments they pay to the Oregon Insurance Guaranty Association (OIGA). In the past insurance companies were able to claim tax credits to offset these assessments. The 2003 Oregon Legislature passed House Bill 3051, which eliminates the tax credits and requires insurers to recover OIGA assessments directly from policyholders using a premium surcharge The OIGA was formed in 1971 to protect policyholders when an insurance company becomes insolvent and unable to pay claims. The guaranty fund pays any covered claims when an Oregon insurance company becomes insolvent and is liquidated by a court order.
In the past consumers in Oregon were not directly affected by the failures of Insurance companies who were no longer able to pay out claims. Instead, all insurance companies share the cost of covering the losses caused by the failure of other insurance companies by having them all pitch in a portion of the loss to insure Oregonians never suffered as a result of poor financial responsibilities. Those insurance companies could recover these losses as a tax credit and policyholders were not expected to pay the costs of poor business practices for other insurance companies.
I’m sure that Oregon is not the only state with a tax and spend attitude and hidden, sneaky, underhanded taxes are likely part of many states insurance system. So when you get irritated at the premium you pay, don’t always assume it’s only the insurance company getting a piece of the pie–apparently weak tax and spending government systems are hiding behind your insurance agents back!
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