Santa Monica, CA –Mercury Insurance Chairman George Joseph is no longer the sole donor to a misleading state ballot initiative that would repeal Proposition 103's prohibition against considering a driver’s coverage history when a motorist applies for insurance.  An insurance agency whose only past political contribution was to the Mercury Insurance sponsored Prop 17, contributed fourteen thousand dollars to the new initiative.  Mercury Insurance Chairman’s George Joseph has already donated over $8.1 million to the deceptive ballot measure aimed at hurting California consumers.

According to the California Secretary of State’s website, Abernathy Insurance Agency, a Mercury Insurance agency, contributed $14,000 to the deceptively titled “2012 Auto Insurance Discount Act, Sponsored by the American Agents Alliance with Support from California Insurance Providers for Competitive Prices and Consumer Discounts.”  This is only the second political contribution ever made by Abernathy Insurance Agency, according to the Secretary of State’s website.  Abernathy’s website directs any customer looking for auto insurance to MercuryInsurance.com

“It is hardly a surprise that the second donor to Mercury’s deceptive ballot initiative is actually an agent of Mercury Insurance.  No matter how hard they try to hide it, this is a Mercury Insurance initiative,” said consumer advocate Brian Stedge.  “Mercury is using the resources and influence of its billionaire chairman to buy its way onto anther ballot, hoping to fool the voters of California.

The Mercury-led initiative also released expenses totaling almost $750 thousand.  The expenses went to petition gathering, consultants and legal expenses (see below).

The current proposal, like the Mercury-sponsored Proposition 17 of 2010, would repeal voter-passed Proposition 103's ban on considering a driver's insurance coverage history when setting rates and premiums.  It would allow insurers to surcharge customers.  Consumer Watchdog estimates that those surcharges would increase premiums by as much as 40% or more for millions of Californians including students who went away for college, Californians who previously used mass-transit, and the long-term unemployed.

“This measure is an abuse of our ballot initiative process by a single corporation that refuses to play by the rules,” stated Brian Stedge.  

Mercury Insurance has been prosecuted in civil courts for violating the previous coverage provision of Proposition 103 that it now seeks to eliminate.  In 2003, when Mercury was illegally imposing the surcharge in California, Consumer Watchdog demonstrated that Mercury surcharged drivers without prior coverage by 41%.  The company also has a long history of anti-consumer practices.  In a 2009 regulatory filing relating to Mercury's illegal practices, the California Department of Insurance wrote:

“Mercury’s lengthy history of serious misconduct, and its attitude – contempt towards and/or abuse of its customers, the Commissioner, its competition, and the Superior Court – are all relevant to determining the penalty needed to best ensure the protection of the public from future violations and wrongdoing… Among Department [of Insurance] staff, consumer attorneys, and consumer victims of its bad faith, Mercury has a deserved reputation for abusing its customers and intentionally violating the law with arrogance and indifference.”

“Once again, this single company and its founder are preparing to spend millions of dollars on a ballot initiative for the corporation's benefit,” stated Brian Stedge.

Expense Report

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