By Josh Richman
Wednesday, November 16th, 2011 at 11:41 am in ballot measures.
Advocates of the “2012 Automobile Insurance Discount Act” ballot measure funded by Mercury Insurance Chairman George Joseph say they’ve gathered and are about to submit more than 800,000 signatures they gathered in 10 weeks to qualify the initiative.
This is well short of their Jan. 9 deadline to gather at least 504,760 signatures.
“This was an easier effort than expected,” Mike D’Arelli, executive director of the American Agents Alliance, said in a news release. “People understand that this discount is good for consumers. The fact that this discount is already allowed in most other states, and allows Californians to shop their insurance loyalty discount with other companies for the best prices, appeals to voters.”
The alliance, which is sponsoring the measure, acknowledges it’s similar to the Mercury-funded Proposition 17, which voters rejected last year, but with some “significant improvements to be inclusive and to reach those who do not have insurance.”
Current law only allows insurance companies to offer consumers a continuous coverage discount, for maintaining automobile insurance if the consumer stays with the same company. This proposal will allow consumers control of the discount so they can take that discount with them to shop for a better price with other companies.
This time, they say, military personnel receive the discount; people who’ve lost their job for a period of up to 18 months also qualify for the discount, as do those who lapse coverage for 90 days for any reason; children living with a parent will receive the same discount available to their parent; and consumers will get a discount for each year they were insured in the previous five years (e.g.. if you had four years of insurance you will get 80 percent of the discount).
“The present system is broken,” D’Arelli said. “It is ridiculous that the consumer loses the discount they have earned if they go to a new insurance company. We strongly believe that allowing the consumers to control their discount will create a more competitive and cost effective insurance market.”
Consumer Watchdog is dead set against the measure, saying it would repeal the voter-approved Proposition 103’s ban on considering a driver’s insurance coverage history when setting rates and premiums, thus letting insurers start surcharging customers. The group estimates those surcharges would increase premiums by as much as 40 percent or more for millions of Californians.
Mercury Insurance had spent more than $15.9 million on its unsuccessful attempt to pass Proposition 17 last year. Now its chairman has spent more than $8.2 million out of his own pocket to back this new measure.
“Mercury is using the resources and influence of its billionaire chairman to buy its way onto anther ballot, hoping to fool the voters of California,” consumer advocate Brian Stedge said earlier this month. “This measure is an abuse of our ballot initiative process by a single corporation that refuses to play by the rules.”