What do regulators aim to protect in the insurance industry?

Regulators in the insurance industry primarily focus on protecting policyholder interests. This is crucial because policyholders depend on insurance companies to provide coverage and financial security in times of need, such as when filing claims after accidents, disasters, or other covered events. By ensuring that insurers maintain adequate reserves, operate fairly, and follow strict underwriting practices, regulators help to guarantee that policyholders receive the benefits they are entitled to when they seek to utilize their insurance. This protection fosters trust in the insurance system, encouraging individuals and businesses to purchase insurance with confidence that their interests will be safeguarded.

Protecting insurer profits, premium income, or shareholder dividends, while potentially relevant to some aspects of the insurance market, is not the primary focus of regulators. Their main responsibility is to maintain a fair, stable, and solvent insurance marketplace that ultimately serves and protects those who hold insurance policies. Ensuring policyholder interests leads to a healthier insurance industry overall, benefiting all parties involved.