If you are a certain age, you have inevitably heard of Gordon Gekko (played by Charlie Sheen in “Wall Street”), or at least his famous quote, “Greed is Good.” As a professional whose master’s degree is in finance, I have always been particularly interested in how corporations and large firms make money. I believe that they owe it to their shareholders to be legal, ethical, and profitable.

Is there a point where greed is too much?

If greed is good, then trial attorneys are awesome. They’ve created fake PR campaigns and “non-profits” to advance their agenda (Realreformla.com is an excellent example). They are throwing money at some politicians and threatening others. They’ve even figured out how to play the Governor for their benefit. “Blame the insurance companies!” They’ve also sucked otherwise respectable businesspeople (like Lee Mallet with Enough is Enough Louisiana) into their schemes.

Now, attorneys are backing a measure that gives the insurance commissioner “power” to reject “excessive” rates, even if, according to some Senators, they are actuarially justified (aka high, but fair according to their costs). House Bill 148 aims to allow the commissioner to say to companies, your rates are too high because I said so. Lower them or choose not to do business here.

It is problematic that the governor is trying to supersede the dually elected insurance commissioner to correct a problem that our own commissioner says doesn’t exist. No other Southern states do what Landry is prescribing in HB 148, despite his claims otherwise.

However, this is far from the only anti-insurance law proposed. For example, there are a few laws proposed by the House that would require carriers to give certain people or certain practices a mandatory discount on their insurance. There was also a proposed law that would prevent insurance companies from using advertising expenses as part of the profit and loss formula for determining rate fairness. This measure was also backed by attorneys. Funny thing coming from the group that has billboards every hundred yards up and down the interstate!

Nowhere have I seen laws proposed to cap attorney fees that can be passed on to clients, or have a judge arbitrarily declare that what they charge their clients is too much, nor declare lower contingency fees. There is no law that punishes them for frivolous lawsuits, and there is no prohibition against certain expenses or compensation (hiring PIs, “expert” witnesses, advertising expenses, etc..).

Insurance companies, like law firms or any other business, have to operate at profit to continue to operate at all. Too many have decided that Louisiana law makes it too hard to be profitable, and they’ve left the state. They made a business decision not to do business here, which tells you everything about their perception of our market. If we make the law less friendly and more threatening, what in the world would make them want to come back?! THIS restricts consumer choices, which makes the market LESS free.

Free speech is a foundational right, but fraudulently trying to manipulate public opinion is despicable. Insurance companies, like attorneys, should be allowed to advertise how they see fit. Perhaps we could be OK with disallowing advertising deductions from state corporate income tax for insurance companies and attorneys, but no one should be prohibited from spending their money how they see fit.

Perhaps filing suit, taking the attorneys themselves to court, is one way to give them a dose of their own medicine. After all, while free speech is protected, coercion is not!

It’s time for our state to tell the politicians and attorneys that we demand free and fair speech and laws in the state of Louisiana. If you want to know more details about bills before the legislature, or why I take the position that I do on these matters, please feel free to call me at our office, 225-389-6024. I’d be happy to discuss, even if you are an attorney. I know lawyers love arguing!