Will Prop. 17 Save Or Cost Californians Money?

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Prop. 17 Among Propositions On June 8 Ballot

SAN DIEGO, CA — A proposition on the June 8 ballot could have a
significant effect on how much Californians will pay for auto
insurance, but there is a disagreement over whether the proposition
will save or cost money.

While everyone would like to save money on car insurance, the
question before voters on June 8 is whether Proposition 17 will do

Right now, drivers who have kept auto insurance with the same
company can qualify for a continuous coverage discount. However, they
can’t take that discount with them if they switch to another insurance
company. Prop. 17 would allow drivers to keep the continuous coverage
discount even if they go with another insurer.

“It’s going to save the average consumer about $250,” said Ken May,
an independent insurance agent in Oceanside. He sells policies from a
number of companies, including Mercury Insurance, which has largely
financed Prop 17.

Harvey Rosenfeld, of the group Consumer Watchdog, has been fighting
insurance companies, including Mercury, for decades. He sees it

“It’s a fraud on the voters to describe Prop. 17 as saving everybody
money,” he said. “It will actually cost people money.”

Rosenfeld said Mercury has spent close to $10 million to get Prop.
17 passed.

“When was the last time an insurance company spent millions of
dollars to save you money,” he asked. “Answer — never.”

May said the proposition will increase competition in the insurance
industry, which helps drivers.

“Competition means lower rates” he said. “They’re going to have to
lower their rates. They’re going to have to offer better service.”

Rosenfeld and other opponents claim drivers who stop their coverage
for more than 90 days for any reason will be hit with a surcharge of up
to $1,000 when they restart their coverage. A lot of attention has
focused on the military in that regard, as military personnel serving
overseas will not be hit with higher rates. But what about those
serving in the U.S., it may be a different story.

“Let’s say you go away from San Diego to another state for boot
camp,” said Rosenfeld. “You drop your coverage for three months. When
you come back home, you’re going to get hit with the surcharge.”

May disputed that insurance companies will do that.

“They don’t want the PR nightmare of turning away military
personnel,” May said. “It just wouldn’t be good for their public

Proponents say Prop. 17 will lower the number of uninsured drivers,
while opponents say the number of uninsured will go up.

Consumer Watchdog
Consumer Watchdoghttps://consumerwatchdog.org
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