Tony Veteto

Tague Alliance

A SIAA Master Agency

How many more changes do we need to our California auto insurance regulations? We are in the midst of working through the Prop 103 regulation enforcement which is already causing serious rate dislocation among the carriers, and now we have another potential wrinkle coming up in June.

Tague Alliance members are fortunate to be able to represent numerous preferred insurance carriers so they will be able to offer choices to their clients. However, rate dislocation from the top of the rating bands to the bottom of the rating bands can cause major service work if the variance is +-5% or greater. The consumer is so price sensitive right now that any rate changes are causing agents to have to remarket their accounts.

So what will a discount for continuous insurance do to the marketplace and the competitive landscape in the auto insurance world? Only time will tell....

Californians for Fair Auto Insurance Rates Qualifies Initiative for June 2010 Ballot

Measure expands auto insurance discount for California drivers

SACRAMENTO, Calif., Jan. 20 /PRNewswire/ -- Californians for Fair Auto Insurance Rates, a coalition of consumer advocates, businesses, senior organizations, taxpayer advocates and insurers, announced today that the Secretary of State has certified the Continuous Coverage Auto Insurance Discount Act for the June 8, 2010 Primary Election ballot. CalFAIR submitted 726,199 signatures and needed 433,971 valid signatures in order to qualify. This measure will allow auto insurance companies to offer discounts to drivers who have continuously maintained their auto insurance coverage.

Under current law, insurance companies are allowed to offer a discount to their existing customers who maintain continuous auto insurance coverage, often referred to as a loyalty discount. However, an inconsistency in the law prohibits drivers from being allowed to take their continuous coverage discount with them if they change insurance carriers. The Continuous Coverage Auto Insurance Discount Act fixes this inconsistency and makes the discount portable.

Like the good driver discount, this ballot measure would reward the more than 80% of responsible California drivers who maintain insurance coverage as required by law by making them eligible for a discount, even if they switch insurance companies. That means drivers will be eligible to take this discount with them when shopping for rates, giving drivers more options when it comes to their insurance coverage. The result will be increased competition, which will lower rates and result in reduced premiums.

That's why the measure is endorsed by groups like Consumers First, Consumers Coalition of California, Citizens Against Regulatory Excess, California Chamber of Commerce, Small Business Action Committee, League of United Latin American Citizens, California Taxpayer Protection Committee and many more.

"We are pleased that the Continuous Coverage Auto Insurance Discount Act has qualified for the June ballot. California consumers will be happy to know that by voting for this measure, they will be eligible to take their continuous coverage discount with them if they decide to change insurance carriers," said Jim Conran, coalition co-chair, president of Consumers First and former director of the California Department of Consumer Affairs. "The current inconsistency in the law prevents insurance companies from extending the continuous coverage discount to new customers and punishes good drivers who want to change insurers. That will change when this measure is passed and will provide consumers the opportunity to shop around for more savings and with more options."

The vast majority of California drivers (82%) maintain insurance and should be rewarded for keeping their insurance current.

Insurance companies still will be required to base a driver's auto insurance rates primarily on their driving safety record, miles driven annually and driving experience. Other discounts, like the good driver or student discount, will not be taken away.

For more information, please log on to our website at www.Cal-FAIR.org.

SOURCE Californians for Fair Auto Insurance Rates

RELATED LINKS
http://www.cal-fair.org/