Voters’ Trust Is At Stake After Attempt to Extort Garamendi
SANTA MONICA, CA — The two principal candidates for Insurance Commissioner should immediately assure voters that they support the “good driver” regulations that the insurance industry apparently believes the candidates will revoke if elected, supporters of Proposition 103 said today in a letter to the presumptive Republican and Democratic nominees.
The letter from the non-profit, non-partisan Foundation for Taxpayer and Consumer Rights (FTCR) and Proposition 103 author Harvey Rosenfield comes two days after Insurance Commissioner Garamendi disclosed that insurers had tried to blackmail him in an attempt to delay the implementation of a key Proposition 103 reform until a new commissioner is elected. Last December, Commissioner Garamendi proposed rules to comply with Proposition 103‘s requirement that auto insurance premiums be based primarily on a motorist’s driving record rather than their ZIP Code.
The letter to Democrat Cruz Bustamante and Republican Steve Poizner says:
“It is obvious that the industry believes that if either one of you is elected, you will reverse Commissioner Garamendi’s decision and withdraw the regulation. As the principal candidates to succeed Mr. Garamendi, you owe voters the assurance that you will support and enforce the regulation as issued by Commissioner Garamendi to reduce the influence of ZIP codes on auto insurance rates and that you will tolerate no efforts to further delay the long overdue enforcement of the law.”
Commissioner Garamendi revealed Monday that a political operative had relayed a message from insurers to back off from regulations that would emphasize a drivers’ safety record rather than ZIP code in pricing auto insurance, or face a $2.4 million negative ad campaign against him. The ads, reportedly launched this week after Garamendi’s refusal to comply with the demand, are widely seen as an attempt to undermine his campaign for the post of lieutenant governor.
“The insurance industry’s attempt to blackmail the Commissioner is far more than an attack on this particular regulation,” the group wrote. “It is a challenge to the integrity and independence of the office you are seeking. It requires an immediate and unequivocal response to avoid being seen by voters as acquiescing to the insurance industry’s attempt to interfere with the regulatory process.”
The nonprofit, nonpartisan Foundation for Taxpayer and Consumer Rights, founded by Rosenfield, has pressed for nearly 18 years for full enforcement of Proposition 103‘s reforms of auto insurance, which the insurance industry has resisted in court and through political lobbying and campaign contributions. “However, the industry has taken a long step beyond contributions with its blackmail effort,” the group concluded. “Only outright repudiation of their repulsive tactic will send the message that the Department of Insurance will remain independent under your leadership.”
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