Consumer Advocates Cry Fowl Over Initiative

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So this chicken walks into a committee hearing…

No, that’s not the setup to a joke. That actually happened this
morning at the State Capitol, where the folks over at Consumer Watchdog pulled a
little PR stunt to raise awareness about their opposition to Proposition 17
on the June ballot.

Consumer Watchdog Founder Harvey Rosenfield appeared at a press
conference with a man dressed in a chicken suit to highlight that a key
figure behind Prop. 17 was too “chicken” (bah dum dum) to appear at a
legislative hearing today about the ballot measure.

Click
here to see the chicken and a video of him entering the committee
hearing
.

Silly, sure. But it worked. A giant chicken is a big step up from the
typical guy in a dark suit droning on. The Sacramento press corps
certainly enjoyed it. And you should have seen the faces of the state
lawmakers when the chicken walked into the committee hearing.

Which is not to say that Prop. 17 is a big joke, because it’s not.
The measure is sponsored and largely paid for by Mercury Insurance, the auto
and home insurance company with a major office in Brea. Mercury and
other initiative supporters
say Prop. 17 would benefit most California drivers by allowing
insurance companies to offer a “continuous coverage” discount to new
customers who switch from another insurer. Opponents say its a smoke
screen to charge drivers more.

You see, in 1988, California voters passed Proposition
103
, which permitted insurance companies to offer discounts to
their own long-term customers but prohibited them from offering such
continuous coverage discounts to new customers. Rosenfield, who authored
Prop. 103, said that provision was included because insurance companies
were surcharging customers for not having insurance in the past. The
point of Prop. 103, he said, was to ensure that California drivers
weren’t penalized simply because they didn’t have insurance coverage
before.

Rosenfield and his folks believe Prop. 17 is Mercury’s attempt to
re-establish penalties for consumers who don’t continuous driver’s
insurance –  seniors who suspend their coverage because they’re
recovering in the hospital.

Rosenfield agreed to speak at today’s informational hearing about the
initiative, but he was upset to hear that Mercury’s CEO, George Joseph,
would not be joining him.  Joseph (who, for the record, is of no
relation to this reporter) is the chicken Rosenfield was mocking.

“Proposition 17 is about a man named George Joseph. He’s the CEO of
Mercury Insurance Co., one of the biggest in California. And for the
last 22 years he’s been fighting to strip California law of consumer
protections that the voters put into effect when they passed Prop. 103
back in 1988,” Rosenfield said.

“Now George Joseph has poured $3.5 million of Mercury Insurance Co.
money into Prop. 17, which would allow insurance companies to raise
people’s premiums if you’ve ever had a lapse in coverage or you’ve
didn’t have prior insurance, say because you’re out of state going to
college or because you’re a senior citizen who is hospitalized.”

Supporters of Prop. 17 say Rosenfield and other opponents have it all
wrong. They say the initiative doesn’t create any new penalties for
drivers, it only would allow companies to offer additional discounts to
drivers who have had insurance for a long time. They say Mercury
is spending big money
on the initiative because it could help
create more competition in the marketplace. It also could help the
company get more market share.

“The more competition that we can infuse into the marketplace, the
more choice, the lower rates, the more the consumer benefits,” said
Michael D’Arelli, executive director of the Alliance of Insurance Agents &
Brokers
, who the Yes on Prop.
17
people provided as a counterpoint to Rosenfield and his chicken.
“This measure saves probably 80 to 82 percent of California drivers
money.”

To that Rosenfield and others in the Stop Prop. 17 camp simply respond:
“Since when would an insurance company spend millions of dollars to put
an insurance initiative on the ballot that’s going to save people
money?”

Meanwhile, another high-ranking Mercury official, however, was
scheduled to testify, which made the whole chicken thing particularly
galling to them.

All kidding aside, this is a bitter fight between old enemies,
Consumer Watchdog and Mercury Insurance — but it might not have to be.
In theory, the Legislature could pass a bill, contingent on the passage
of Prop. 17, that would explicitly outlaw the things Consumer Watchdog
is afraid will happen. That would eliminate Consumer Watchdog’s fears,
presuming that’s what they’re really afraid of, and it would keep the
benefits Mercury and its people say they want, presuming that’s what
they’re really after.

It could be an easy fix, but that would require both sides to give up
their little game… of chicken. (Couldn’t resist. Sorry.)

Also, a special shout out to Bob Moffitt of Sacramento’s NewsTalk
1530 KFBK radio who shot the video of the chicken.

Consumer Watchdog
Consumer Watchdoghttps://consumerwatchdog.org
Providing an effective voice for American consumers in an era when special interests dominate public discourse, government and politics. Non-partisan.

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