Bill to Raise Auto Premiums for Returning Soldiers, Others With Coverage Lapses on Davis’s Desk
Los Angeles, CA — Major Theodore Byrne and consumer advocates with the Foundation for Taxpayer and Consumer Rights (FTCR) called on Governor Davis to veto SB 689 (Perata), which will impose rate increases on soldiers returning from service. They spoke outside the corporate offices of the bill’s sponsor, Mercury Insurance, in Los Angeles. On September 12, 2002, two days after the bill arrived on Governor Davis’s desk for signature or veto, Mercury Insurance contributed $25,000 to Davis.
“Our soldiers fighting the war on terrorism will come back to California and get an insurance rate hike as their thanks if Governor Davis signs this bill,” said Major Theodore Byrne, speaking as a private citizen. “I’ve worked with many men and women who are half way around the world right now, and, of course, have let their auto insurance lapse. Why should these reservists face higher premiums when they come home? They are not suddenly worse drivers. I hope Governor Davis stands by our soldiers and vetoes this bill.”
Major Byrne, who is also an adjunct professor at Pepperdine University and Cal State Dominguez Hills, noted that reservists typically earn less when they are serving than in their civilian employment and cannot afford to shoulder a new insurance surcharge.
The bill will overturn a ruling by Insurance Commissioner Harry Low that would ban surcharges on drivers who had a lapse in insurance coverage or were previously uninsured. This includes members of the military reserves who drop coverage when they are called into service, as well as people who drop coverage for other reasons. Such surcharges were specifically prohibited by voter-approved Prop. 103, which was enacted in 1988. Consumer and civil rights groups will sue to invalidate the law if the governor signs it, according to FTCR.
“Since Insurance Commissioner Low announced that he would not let companies violate the law that protects drivers with coverage lapses, Mercury has tried to buy a new law. Last week the company gave $25,000 to Governor Davis after giving hundreds of thousands of dollars to lawmakers who passed the bill this summer,” said consumer advocate Doug Heller with the Foundation for Taxpayer and Consumer Rights. “Governor Davis should stand up for California soldiers and reject this shameless contribution and veto this shameful bill.”
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