HomenewsreleaseBallot Initiative › Consumer Watchdog Campaign: California Editorial Pages Recommend “No on Prop 33,” Expose Lies of Insurance Industry-Backed Prop 33 Campaign

News Release

Consumer Watchdog Campaign: California Editorial Pages Recommend “No on Prop 33,” Expose Lies of Insurance Industry-Backed Prop 33 Campaign

Contact Info
Name:

Jamie Court & Carmen Balber

Phone Number:
Jamie, (310) 392-0075; or Carmen, (310) 403-0284

Santa Monica CA -- Three of California’s largest newspapers issued No on Proposition 33 endorsements this weekend, repudiating the false claims about the initiative made in campaign materials and deceptive advertisements now running across the state.  Prop 33 would allow insurance companies to increase prices on good drivers who have a lapse in their insurance coverage, even if they dropped their insurance because they weren’t driving or didn’t have a car.

The No on 33 endorsements made by the San Francisco Chronicle, Sacramento Bee and Bakersfield Californian rebut ads paid for by Mercury insurance chairman George Joseph who has given 99%, or $8.4 million, of the funding for the Prop 33 campaign.

Read the newspaper editorials here: http://stopthesurcharge.consumerwatchdogcampaign.org/feature/editorials-against-prop-33

“Californians should know that Mercury insurance founder George Joseph is lying to them about Prop 33’s impact on their insurance rates, and hiding the fact that he contributed 99% of the money backing Prop 33,” said Carmen Balber with Consumer Watchdog Campaign. “Editorial boards across the state are countering Mercury’s lies about Prop 33 with the truth that it will raise auto insurance rates for good drivers.”

Prop 33 radio advertisements say: “If you maintain car insurance in California you’re eligible for a continuous coverage discount, but only if you stay with the same insurance company.” The Bakersfield Californian debunks that claim:

“Prop. 33 backers maintain that drivers already get a discount for obeying the law and for maintaining insurance coverage with their current provider -- but if they switch companies, they lose that discount. The truth is, no such discount exists.

“Under current insurance regulations, customers get loyalty discounts for renewing their policies because long-term customers cost insurance companies less money, not because they obey the law. Insurers simply don't spend as much on marketing and administration for existing customers as on potential new customers. That savings has been vetted by insurance regulators. There is no proof, however, that a driver's length or continuity of coverage impacts risk. In fact, in order to give some people this so-called discount, insurance companies would have to increase rates for other drivers.”

A Prop 33 campaign ad claims that the measure “insures more drivers.” The Sacramento Bee says the opposite is true:

“Current law seeks to ease the entry of people new to auto insurance and the re-entry of others who have gone off insurance for a time. In today's harsh economy, many drivers are looking for ways to cut expenses, and unfortunately may eliminate auto insurance.

“We should not change state law in a way that would discourage motorists from buying insurance. Nor should we encourage them to drive uninsured, which costs all of us.”

The ballot argument in support of Prop 33 states that the measure “allows this discount to everyone who follows the law.” The San Francisco Chronicle says:

“It sounds good on the surface, but here's the hitch: Those modest discounts almost surely would come at the expense of rates on drivers who had not previously been insured. Yes, that could include some deadbeats who were driving without insurance in violation of the law, perhaps because they lost their job or otherwise had a financial crisis. But it also would include people who had a lapse in coverage because they lived in an urban area and did not need a car, or were ill and not driving.”

The San Jose Mercury News/ Contra Costa Times and the Ventura County Star have also editorialized against Proposition 33.

Listen to the Prop 33 radio ads here: http://www.yesprop33.com/news/audio/

Read the Prop 33 ballot arguments here: http://www.sos.ca.gov/elections/vig-public-display/110612-general-election/

Prop 33 would overturn a 24-year-old law banning discriminatory practices by auto insurance companies that were brought to light in a 1987 California civil rights case, King v. Meese. Proposition 103, passed by the voters in 1988, banned auto insurers from charging more, or refusing to sell insurance, to people who were not previously insured.

Joseph and his Mercury insurance company have tried to overturn that law for more than a decade through regulation, legislation, in the courts and at the ballot box. The most recent failed attempt was Proposition 17, a ballot measure rejected by the voters in 2010.

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Learn more about Proposition 33 at www.StopProp33.org