Vehicle traffic

Our election coverage continues with a debate on Proposition 33, which would change how insurance companies can give discounted rates.

Jamie Court, president of Consumer Watchdog in Los Angeles and leader of
Sam Kang, general counsel for the Greenlining Institute, a multi-ethnic public policy research and advocacy institute

  • Peter D

    Would this harm those who don’t need car insurance, because they don’t need to own a car, or would their situation be roughly the same?

    • Yes – when they decide to drive again, they would pay a higher rate.

  • Cyclist

    I haven’t owned a car in CA in over 10 years, intentionally – I’m a cyclist and moved to SF in order to live and work in an alternate model to American car culture, for the benefit of myself and my planet. In the next few years I plan to begin a family, and know my partner and I will need to get a car. While I do ZipCar and am a licensed driver, I will not have had my own auto insurance for 14 or 15 years. That I might be penalized for the noble choice *not* to own a car is ridiculous. What type of cost difference are we talking about? Why don’t the people trying to make a difference to society by “doing the right thing” ever get rewarded for that?

  • Having moved to San Francisco recently for a new job, I decided to sell my car, because thanks to a vibrant public transit system, a car simply isn’t needed at this time.

    However, I will undoubtedly begin driving again at some point down the road. I have a perfect driving record, but under Prop. 33 will have to pay an unfair penalty that record, to subsidize the discount Prop. 33 extends to others.

    • ..

      Yeah, but your driving record is only “perfect” because you don’t drive. That’s hardly the same as an experienced driver with a clean record. I wonder if driving experience plays a role in determining risk. I could see why companies might charge more to people who don’t have as much experience.

      • That’s not the case. I use Zipcar multiple times a week.

  • $11165038

    It would definitely affect me. About 5 years ago my car was hit when it was parked outside my house, the driver never stopped or left a note so I had to go through my insurance to repair it. They decided the car was a total loss and since I couldn’t afford to repair it on my own, I took the insurance money but it was not enough to buy a new or new to me car. My mother had an second car that she has let me drive but it is under her name and her insurance. When I am in the position to purchase a car and insurance again, this law would definitely make me think twice of doing both since I will definitely be paying a higher rate for my car insurance, not because of my driving record but because I have been without car insurance in my own name.

    • .

      Liz, you would still get a proportional discount for each year you were insured. Remember, the main factors companies use to determine rates are years of driving and driving record as “risk” factors. The discounts come after all that. This would play only a small role in determining your rates.

  • James Ivey

    If the Mercury billionaire has been won over as the proponent says, what’s wrong with the status quo?

  • Kathi

    Is the billionaire behind this iniative a member of ALEC? Is this one of their model bills?

  • EIID


  • EIID


  • Common sense consumer

    So Prop 33 will give me the ability to shop for a better insurance rate while KEEPING my discount AND it protects me in case I get unemployed or if I’m in the military? Why the heck would anyone oppose this?

    • Because that discounted rate is subsidized by people who shouldn’t have to pay extra to resume insurance coverage if, for example, they decided not to own a car for a period of time and now need to purchase a car.

      • Michelle

        Actually those drivers would still get a proportional discount for each year that they had coverage, even if there were lapses. Overall, Prop 33 will make the market more competitive, keeping rates affordable so more drivers could afford insurance. For all the cyclists, etc. this should matter to you too. If you get hit by a car, you will want that driver to have insurance.

        • Unfortunately, this isn’t the case. Prop 33 raises the bar of entry for new insurance buyers. So those who are driving uninsured today would see higher premiums if they decide to purchase insurance, thereby potentially further dissuading them from becoming insured.

    • Neig

      Why insurance company like prop 33? Is it a divide-and-conquer scheme to raise revenue for insurance company?

  • D

    If Prop. 33 was a proposition that was being pushed hard by insurance companies, don’t you think they’d all be jumping on it and all their supporters. And not none but one..READ IT BEFORE YOU VOTE!

    “Proposition 33, an initiative to let auto insurers offer discounts to
    competitors’ customers, isn’t quite the same as Proposition 17, a
    similar proposal that voters rejected in 2010. But the campaign in favor
    of the measure seems to be following the same truth-distorting
    playbook.” _LA Times

  • MattCA12

    Prop 33 is utterly ludicrous. Insurers are under NO OBLIGATION to provide “loyalty discounts” to anybody. They do it because they’ve found it helps them retain customers. Folks, you don’t “get” auto insurance. If you want to drive, you have to buy it. It’s a fee for service. Want to switch to another company that’s giving you a better discount or who has better customer service? Go right ahead! Insurers don’t owe you anything, and neither does the State of CA. If you don’t pay your premium, because you’ve lost a job or decide to join the military (yes, we still have an all-volunteer force), why shouldn’t you lose your coverage? You haven’t had insurance before, and are buying it for the first time and are worried that your premium will be higher? Why shouldn’t it? It’s called risk. And people, wake up and think for yourself. It doesn’t matter who is funding this. Every proposition in this state is funded by somebody with deep pockets.

    • MattCA12:
      Utterly ludicrous? Jamie Court sounded really worked up over it,
      said it’s a lie, and slammed the opposition speaker, attorney Sam
      Kang, for his client/employer Greenlining Institute taking money
      to work of Prop33 as if they were bought off. Who pays Consumer Watchdog’s bills?

      Car insurance in manditory, and because of Prop103, no insurer
      can charge you based on rules and rates until the state first
      approves them.

      I don’t get why anyone opposes this proposal. The fear factor
      being spread by Mr. Court is that this will “create a new rating
      factor” which will be used by evil insurers to over charge the
      poor and uninsured. Why, because insurers are mean and greedy, and want to create even more uninsured drivers.
      Well, we know they’re greedy, because we’re all greedy, but
      they’re not evil, and they lose money if less people buy insurance.

      The money needed to run a campaign is crazy, but part of that is because CA is a state bigger than most countries. Matt’s
      right – it shouldn’t matter who’s paying for it, what matters is
      if it makes things better or worse.

      One thing I’m sure of, Mercury wants to do this, because they
      think it will help them sell more policies. The customers they
      want are the same ones everyone else wants – the good ones!
      I don’t see any tricks involved in this.

  • I must be missing something

    I have been with the same insurance company (State Farm) for more than 30 years. I DESERVE a discount for being such a long term and consistent customer. Most people pay a higher rate from 18 to 25 yrs since their driving experience is less than more experienced drivers. (NO tickets for more than 30 years)

    After that age group, other considerations are still the same: how much time does one have driving in the environment and what is their driving record.
    Problems: Change the laws so a person can’t buy insurance for 3 months and then cancel. Too many people do this to get through the driving license period and then cancel their policy.

    Time and record behind the wheel is what matters…so what is the problem?

  • VelvetAlley

    I’m listening to this thinking “Why are we even talking about this?” Why does the government have the power to determine how a private company chooses to to business with its members?
    This seems equivilent to this fictious prop:
    “With Prop Hamburger, people who have loyally bought Big Mac’s at McDonalds for 5 years or longer and have recieved discounts because of their loyalty, can now go to Carl’s Jr and buy a Famous Star as if they had been buying Famous Stars all along.”
    This wouldn’t happen because burger joints are privately owned corporations as are insurance companies. What am I missing here?

  • More than 85% of CA drivers are currently insured. After being insured with the same company for a number of years they get a Loyalty Discount. However, under current law, if the decide to switch from State Farm to Progressive, they lose any kind of persistency discount they had. Prop 33 will allow insurance consumers to “take their discount with them” and will no longer be “tied” to a company for fear of having to start all over again. Prop 33 will encourage consumers to shop around to get the best rate and competion amongst insurance companies will keep rates down.

  • Oh boy… Jamie Court is twisting the truth in regards to the bill signed by Jerry Brown yesterday. Many unlicensed drivers are already being insured by many insurance companies in CA. Yes, there are companies that insure these folks with their foreign licenses. So to say that these “new drivers” will have to pay more is a lie. They too will be able to take their Loayalty discount to any other insurance company in CA. after Prop 33 is enacted. And, when he says that Prop 33 “is the same as Prop 17” he is lying again. Jamie Court will say and do anything to protect Prop 103, the Harvery Rosenfield/Consumer Watchdog proposition that is being amended under Prop 33. Jamie needs to read the language of Prop 33. It is clearly a consumer dirven bill. Shame on Consumer Watchdog for not wanting consumers to get a discount they deserve.

  • Credibility is a issue. Is Consumer Watchdog more concerned about where their next government funded paycheck is coming from, or are
    they really interested in promoting greater competition that is proven
    to lower consumer’s rates?

    George Joseph of Mercury Ins. is only doing this because he knows that the current rating system that Consumer Watchdog stuck us with
    is providing an unfair advantage to any insurer who’s customers renew
    for a few years or more.

    All this would do is level the playing field. No one would need to change
    insurers, but if they wanted to, they could be sure they’d get the lowest
    price, because they wouldn’t lose that renewal discount they have now.

    For those who have no insurance, it really shouldn’t matter because
    their rates are already taking that into account. The Prof who says
    the previously uninsured will have to make up the good driver’s savings is wrong. Just another opinion, not a fact.

    VOTE YES on P33, do yourself a favor.

  • FDiM

    Wow. Its amazing the amount of paranoia. None of these talking heads are insurance brokers or agents. I represent Mercury and when this discount was used years ago, the rates were substantially cheaper for those who had prior insurance. Much cheaper. Im not concerned about first time drivers or those who havent needed insurance. As they pay, their rates will fall as they build up their insurance paying record. They arent stuck with high rates forever. Overall….this is a very good idea for CA drivers. I will vote for it and will promote it with all of my clients.

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