Californians living in high fire danger areas are facing an insurance crisis as companies are drastically increasing their rates or dropping their policies completely.
Consumer Watchdog President Jamie Court says Insurance Commissioner Lara can do more to prevent discrimination against people and protect Californians in high fire risk areas with his regulatory powers.
Homeowners in high fire risk areas are experiencing insurance premium increases of up to 4 times more expensive, some not being renewed at all.
Consumer Watchdog President Jamie Court says that we should enforce tighter restrictions on insurance companies so they are not be able to raise homeowners insurance premiums this drastically for consumers in these fire risk areas. “We should make sure that the people who are seeing the biggest premium hikes are able to get a break if they are fire-hardening or fire-safing their home but that will take the insurance commissioner digging in and getting tough on insurance companies and we haven't seen that yet.”
“As Insurance Commissioner, you have broad power that you are not using to prevent insurance companies from unfairly penalizing homeowners,” Consumer Watchdog Executive Director Carmen Balber wrote. “There is a way, now it is up to you to demonstrate the will.”
ABC10 asked Lara to respond to the letter Wednesday night, following a packed meeting he led at the Gold Country Fairgrounds in Auburn.
In the letter, Balber outlines three emergency rules she says Lara can issue now to protect homeowners.
She wants Lara to require each insurance company that does business in California to offer a discount to homeowners who make investments in hardening their home against wildfires – work like that which the Caseys did, clearing trees and bushes. She likens it to automobile insurance companies giving discounts to safe drivers.
Consumer Watchdog is also asking Lara to "bar the use of claims software that low-balls the cost of repair and reconstruction" and stop insurance companies from using any wildfire risk models “that lead to excessive or discriminatory rates,” citing the FireLine® score, which is now infamous to homeowners in fire-prone areas. Insurance companies use it to determine homeowners' fire risk and whether to sell them fire insurance.
United States Senators Ed Markey and Richard Blumenthal have written to the National Highway Traffic Safety Administration (NHTSA) to ask if carmakers have reported the cybersecurity vulnerabilities in their Internet-connected cars and what steps NHTSA is taking to address the problem.
The senators called for the answers from the America’s top car safety regulator in response to Consumer Watchdog’s recent report, “Kill Switch: How Connected Cars Can Be Killing Machines and How to Turn Them Off.” The report, prepared with the help of car industry technologists, found that all the top 2020 cars have Internet connections to safety critical systems that leave them vulnerable to fleet wide hacks.
The largest fine issued against a car insurance company in California has been upheld by the state supreme court. As mandated by Prop 103, insurance companies must charge fair premiums and get the insurance commissioners's approval for those rates.However Mercury had been overcharging consumers by adding broker fees on top of premiums. The California supreme court has upheld the decision that Mercury must pay the $27 million fine.
California Insurance Commissioner Ricardo Lara recently told the insurance industry in a closed door meeting what he wants to give them direct access to the safety critical systems in your car that show how you brake, accelerate and steer. Consumer Watchdog's Jamie Court says this is dangerous to your safety and privacy.
LOS ANGELES - Consumer Watchdog is blowing the whistle on recent comments made by the California Insurance Commissioner that could drastically change how auto rates are determined in California.
Jamie Court of Consumer Watchdog, says this could mean sacrificing more money and privacy.
Currently, auto insurance premiums in California are based on rating factors such as safety record, mileage and driving experience. Commissioner Ricardo Lara, according to remarks he made at an insurance conference in Hollywood last month, wants to give insurance companies access to a driver's vehicle data to monitor how quickly a driver stops, turns, and accelerates.
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The data would also include a driver's route. Lara's pitch to some 200 top industry attorneys was caught on cell phone video by an attendee. He told the crowd, "I honestly think that if someone is monitoring the way you're braking or how you're driving - you better believe that's going to change your driving behavior and that's something that can save lives."
Court says allowing companies such access is nothing more than a privacy invasion. He says, "You shouldn't have to have the insurance companies in the car with you looking over your shoulders every time you brake, every time you steer. That's big brother. That's wrong!" Court says not even good drivers would benefit as companies would interpret a good driver based on their own prejudices.
In response to the criticism, Insurance Commissioner Lara issued the following statement to FOX 11:
"I have been clear since day one that technology is affecting all aspects of our lives including insurance.Like all Californians, I want your auto premiums to be based on how you drive, not where you live or who you are. That is the genius of Proposition 103, which has saved consumers hundreds of millions of dollars over the past 30 years.In that time, the Department has continually modernized our automobile rating rules, for instance by allowing ‘pay as you go' rates in 2009 and eliminating gender as an optional rating criteria earlier this year. The proper use of telematics, should a consumer decide to opt-in to the use of this technology, could have the potential to enhance driver safety and control premiums, and we will be engaging with consumer groups and privacy experts to ensure that we protect Californians' data."