Proposition 103

Consumer Watchdog Study: Public Scrutiny Has Saved Californians Over $5.5 Billion on Home, Auto Insurance Since 2002, Including $885 Million at Year-End

Retrieved on: 
Thursday, February 1, 2024

LOS ANGELES, Feb. 1, 2024 /PRNewswire/ -- Consumer Watchdog, a non-profit citizen organization, has saved state consumers $5.5 billion over the last 21 years using a voter-approved law that gives Californians a powerful and direct voice in how much insurance companies can charge – and insurance companies are trying to get rid of it.

Key Points: 
  • The report finds that insurance companies are primarily responsible for unnecessary delays in completion of rate reviews, not public scrutiny.
  • "Consumer Watchdog has blocked insurance companies from overcharging homeowners, renters, drivers and health care providers by $5.5 billion over the last 21 years," said Carmen Balber, Executive Director of Consumer Watchdog.
  • "The goal of the opponents of public scrutiny and participation is to allow insurance companies to overcharge Californians.
  • Since Insurance Commissioner Lara took office, Consumer Watchdog's rate challenges have saved Californians $2.1 billion.

32 California House Representatives Express Concerns About Insurance Commissioner Lara's "Sustainable Insurance Strategy," Says Consumer Watchdog

Retrieved on: 
Wednesday, November 8, 2023

WASHINGTON, Nov. 8, 2023 /PRNewswire/ -- Thirty-two members of California's Democratic Congressional Delegation wrote a letter to Insurance Commissioner Ricardo Lara this week expressing concern that a plan he announced in September would diminish the Insurance Commissioner's regulatory power and threaten the consumer protections established in insurance reform Proposition 103.

Key Points: 
  • We believe it is important to keep California consumer interests at the forefront of your decision-making process.
  • Prop 103 made the Insurance Commissioner's office an elected post and Representative Garamendi was the first elected Commissioner in California.
  • Consumer Watchdog warned last week that the deregulation deal cut by Insurance Commissioner Ricardo Lara with the insurance industry will not expand access to affordable insurance for California homeowners or small businesses.
  • Documents uncovered by Consumer Watchdog through a public records request reveal that the quid pro quo for allowing insurance companies to plunder California – the insurance industry's "commitment" to resume the sale of insurance – is riddled with loopholes.

Consumer Watchdog Warns Governor, Legislative Leaders that Insurance Commissioner Lara's Deregulation Deal with Insurers Has No Consumer Benefits

Retrieved on: 
Thursday, November 2, 2023

LOS ANGELES, Nov. 2, 2023 /PRNewswire/ -- Consumer Watchdog has written Governor Gavin Newsom, Senate pro tem Toni Atkins and Speaker Robert Rivas to warn that the deregulation deal cut by Insurance Commissioner Ricardo Lara with the insurance industry will not expand access to affordable insurance for California homeowners or small businesses.

Key Points: 
  • Commissioner Lara refused to respond to the revelation and instead attacked Consumer Watchdog for saving consumers money.
  • Politico reported last night that the insurance industry is parroting the same talking points in a new website and ads defending deregulation with a similar attack on Consumer Watchdog.
  • "When the insurance industry and the Insurance Commissioner start syncing their talking points consumers should check their wallets," said Carmen Balber, executive director of Consumer Watchdog.
  • Politico reported that the insurance lobbying group, American Property Casualty Insurance Association (APCIA), behind the attack on Consumer Watchdog had simultaneously launched a campaign to promote its deregulation plan with Insurance Commissioner Lara.

Records Show Insurance Commissioner's Deal with Industry to Expand Wildfire Coverage is a Sham, Says Consumer Watchdog

Retrieved on: 
Thursday, October 26, 2023

The commissioner could waive the "85% commitment" to sell more home insurance in wildfire areas for any insurer that claims it cannot meet its commitment.

Key Points: 
  • The commissioner could waive the "85% commitment" to sell more home insurance in wildfire areas for any insurer that claims it cannot meet its commitment.
  • The records obtained are emails and bill language circulated by the commissioner's chief deputy to the insurance industry's top lobbyists and legislative staff in late August.
  • "These documents prove Commissioner Lara's deal with the insurance industry is an outrageous fraud on the public that will make Californians pay vastly more for insurance but not get more people insured.
  • Lara tried to jam the deal through the legislature, and when that failed repackaged it as a regulatory plan.

Consumer Watchdog Challenges Recidivist Mercury Insurance for Policyholder Price-Gouging, Discrimination and Deception

Retrieved on: 
Wednesday, October 11, 2023

Consumer Watchdog said its participation in the matter would focus on the company's violations of Proposition 103, the 1988 insurance reform initiative.

Key Points: 
  • Consumer Watchdog said its participation in the matter would focus on the company's violations of Proposition 103, the 1988 insurance reform initiative.
  • Consumer Watchdog noted that Mercury had previously promised CDI it would stop many of these practices, which are unlawful under Proposition 103, but nevertheless continued to violate the law.
  • Mercury, as a repeat offender, must pay a steep price or no insurer will bother to obey the law.
  • Consumer Watchdog looks forward to working with CDI prosecutors to bring Mercury to justice – which we believe means barring Mercury from doing business in the state."

Lara's Deal with Insurance Industry Does Nothing for Consumers and Does Not Address Climate Change, Says Consumer Watchdog

Retrieved on: 
Tuesday, September 26, 2023

Consumer Watchdog has recommended establishment of a state land use commission to address this, and that insurance companies be required to insure all homeowners who harden their homes.

Key Points: 
  • Consumer Watchdog has recommended establishment of a state land use commission to address this, and that insurance companies be required to insure all homeowners who harden their homes.
  • Rules finalized last year require insurance companies to offer discounts to homeowners who protect their homes from fire.
  • However, the discounts that insurers began proposing in April have yet to be approved for implementation by the Department of Insurance.
  • "The insurance industry has shifted all of the costs of climate change onto homeowners, by non-renewing policies, increasing premiums, and delaying and denying claims.

Triple-I: California’s Insurers Still Feel Impact of 2017-2018 Wildfires

Retrieved on: 
Thursday, September 21, 2023

A 108.1 ratio means California’s insurers paid out $1.08 in claims and expenses for every dollar collected in premiums within that timeframe (2013-2022).

Key Points: 
  • A 108.1 ratio means California’s insurers paid out $1.08 in claims and expenses for every dollar collected in premiums within that timeframe (2013-2022).
  • The combined ratio for California’s homeowners insurers stood at 241.9 in 2017 and 213.4 in 2018, the Triple-I Issues Brief notes, citing AM Best data.
  • The policyholder surplus is the amount of money remaining after an insurer’s liabilities are subtracted from its assets.
  • “This is a large and potentially profitable market in which insurers want to do business,” the Triple-I Issues Brief adds.

Consumer Watchdog Says Lara's Undisclosed Deal Will Allow Insurance Companies to Use Algorithms And Reinsurance Costs to Hike Home Insurance Rates, Potentially Turning California Into Florida

Retrieved on: 
Friday, September 22, 2023

"Consumer Watchdog will not allow Lara to derail the right of consumers to challenge the insurance companies or the Department, under which Consumer Watchdog has saved Californians over $3 billion over the last twenty years.

Key Points: 
  • "Consumer Watchdog will not allow Lara to derail the right of consumers to challenge the insurance companies or the Department, under which Consumer Watchdog has saved Californians over $3 billion over the last twenty years.
  • We will carefully monitor the Commissioner's and his agency's actions, and, as we have for decades, defend and protect the rights of California voters.
  • "The use of catastrophic modeling and adding of reinsurance costs to premiums has pushed Florida premiums up 2 to 3 times higher than California's" said Jamie Court, president of Consumer Watchdog.
  • "California is in danger of becoming Florida with these changes that mimic the failed strategies in the Florida.

Insurance Industry Fails to Win Backroom Bailout in CA Legislature

Retrieved on: 
Tuesday, September 12, 2023

SACRAMENTO, Calif., Sept. 12, 2023 /PRNewswire/ -- The insurance industry's attempt to pass a secret, last-minute bailout deal failed when a legislative deadline passed Monday night with no bill in print. Consumer advocates condemned the backroom process and called for a public, transparent debate to address insurers' pullouts from the home insurance market. The industry's focus now shifts to Insurance Commissioner Ricardo Lara, who documents show was at the center of negotiations shaping the bailout. Consumer Watchdog sent a formal records request to Lara today seeking the text of the proposal and his communications with insurers. 

Key Points: 
  • Consumer advocates condemned the backroom process and called for a public, transparent debate to address insurers' pullouts from the home insurance market.
  • The industry's focus now shifts to Insurance Commissioner Ricardo Lara, who documents show was at the center of negotiations shaping the bailout.
  • A memo circulated by an insurance industry lobbyist last week sought support for "the plan" endorsed by Insurance Commissioner Lara.
  • Despite insurers claims of financial crisis, insurance companies made four times the profit on home insurance in California than the national average .

Garamendi, Nader, and SD Union Tribune Add Voices Against 11th Hour Insurance Bailout Legislation, Consumer Watchdog Urges Vigilance Until Monday Deadline

Retrieved on: 
Friday, September 8, 2023

"Until lawmakers and Insurance Commissioner Ricardo Lara say they are not going to pursue the insurance industry's billion-dollar bailout plan, California consumers must remain alert for an 11th hour smash and grab," Consumer Watchdog said.

Key Points: 
  • "Until lawmakers and Insurance Commissioner Ricardo Lara say they are not going to pursue the insurance industry's billion-dollar bailout plan, California consumers must remain alert for an 11th hour smash and grab," Consumer Watchdog said.
  • A memo written by insurance lobbyist John Norwood , circulated Wednesday evening, asked legislators to back "the plan" endorsed by Insurance Commissioner Ricardo Lara.
  • Not a single consumer advocate or consumer advocacy group met with Lara in those months; written requests from Consumer Watchdog have been ignored.
  • The outline of the industry's proposal was published only a few weeks ago and its impact on consumers analyzed by Consumer Watchdog.