A three-way fight over the language in a June ballot initiative on auto insurance ended in a draw Friday.
Sacramento Superior Court Judge Allen Sumner declined to delete wording submitted by insurer Mercury General Corp., the main sponsor of Proposition 17, in voter information pamphlets.
But the judge also left intact the pamphlet summary proposed by Attorney General Jerry Brown, including language Mercury tried to have removed.
The judge did order initiative opponent Harvey Rosenfield, the prominent consumer advocate, to reword some of his rebuttal language.
Under existing insurance law, companies can offer discounts to loyal customers who maintained continuous coverage for a long period. With Proposition 17, set for the June 8 ballot, Mercury wants to broaden the rule so insurers can offer the same discounts to long-standing customers of other companies.
Mercury says Proposition 17 would increase market competition by giving insurers another weapon to lure motorists to switch companies.
But Rosenfield and Brown say the proposition could also lead to higher rates for other motorists — those who don’t qualify for the discounts.
That’s a function of the so-called "zero-sum" aspect of California insurance rate-making. Every discount given to one driver must be offset by a "surcharge" imposed on somebody else, says the Department of Insurance.
Lawsuits ensued over just how that impact would be described in the voter pamphlets, landing all three parties in court: Brown, Rosenfield and the backers of Proposition 17.
Brown, for instance, insisted on language saying the initiative "will allow insurance companies to increase cost of insurance to drivers who do not have a history of continuous insurance coverage."
Backers of Proposition 17 wanted that language stricken, but the judge disagreed.
The judge did order Rosenfield to make some changes in his pamphlet statement attacking the initiative.
Backers of Proposition 17 hailed that decision, saying Rosenfield was engaging "in scare tactics."
But Rosenfield called the changes minor and said, "As far as I’m concerned, it’s a victory."
Call The Bee’s Dale Kasler, (916) 321-1066. or [email protected].
Read his blog on the economy, Home Front, at http://www.sacbee.com/blogs.