Appeal-Democrat (California)
There is no insurance for the hits lawmakers took Thursday for responding to a plan they say pits big city drivers against rural folks.
Assemblyman Doug LaMalfa and four other legislators heralded AB 2840, which would require a statewide study before changes are made to the way auto rates are calculated. The point, lawmakers said, is to ensure rate calculation changes are fair.
“I believe more study is needed so we can be sure there are no unfair negative impacts on drivers who can least afford it,” said Assemblywoman Lois Wolk, D-Davis.
LaMalfa, R-Richvale, who represents a large portion of the Mid-Valley, said he has opposed the change from the start.
“Rates for my constituents will go up if it takes effect. I don’t believe that’s fair since my constituents live in areas where the cost of providing insurance is less for them than for a driver in Beverly Hills, Santa Monica or San Francisco,” LaMalfa said.
But the Foundation for Taxpayer and Consumer Rights accused the group of complying with insurance industry desires.
“Over the last two decades, the insurance industry has used every type of scare tactic to stall insurance reform. Now, insurers have put $300,000 into the pockets of these five politicians who have introduced the latest scheme to block and maintain high rates for good drivers,” foundation Executive Director Douglas Heller said in a statement.
Heller said the legislators were swayed by past campaign contributions from the industry, including $69,550 to Assemblyman John Benoit, R-Palm Desert, who authored the bill, and nearly $36,000 to LaMalfa.
Assembly members say the bill is their reaction to Insurance Commissioner John Garamendi‘s proposal to change the way Californians’ rates are established.
Garamendi has maintained his proposal makes bad drivers pay regardless of where they are driving. He figures relying on driving records when setting rates will reduce insurance rates for the best drivers.
Lawmakers cited two studies, including one commissioned by the Department of Insurance, which found that implementing proposal like Garamendi’s could result in rate increases as high as 30 percent for some drivers, mostly in the rural and suburban areas.
“It shouldn’t matter where drivers live, in the city or in the country. We should all pay fair insurance rates that are based on our risk of having an accident or filing a claim,” said California Farm Bureau Federation President Doug Mosebar. “Rural drivers have far fewer auto insurance claims than drivers living in cities. We support AB 2840 because it guarantees a better way to provide a fair system for everyone.”
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Appeal-Democrat reporter Eve Hightower can be reached at 749-4724. You may e-mail her at [email protected]
