Proposition 17 dings the uninsured

As another election comes upon us, one of its components reinforces the notion that California and the car culture are synonymous. The land that introduced drive-in theaters and restaurants, the freeway, the hot rod, the low-rider, and the motel (motor-hotel), will pay special attention as a measure involving automobile insurance comes up before the voting public.
Given the attachment many have for wheeled transportation, the upcoming ballot measure, Proposition 17, holds particular poignancy for voters.
The measure will require that insurance companies give premium discounts to drivers with significant lengths of past liability coverage with other providers. The rationale here is that long-term customers should be given monetary reductions, even if they switch carriers (currently policy-holders may be assessed a surcharge for changing companies).
Opponents counter that this is merely an underhanded attempt by insurance companies to reverse the gains made with the passage of 1988’s Prop. 103, which lowered rates and brought regulation to the industry.
Presently, a steady customer may be rewarded for their loyalty by being granted a discount by their established carrier. Under the proposed change–dubbed the Continuous Coverage Discount Initiative Impact on Rates–the insured would be given this discount even, if they found a more attractive offer from another provider and decided to take advantage of it by changing carriers. However, if there is a break of 90 days or more, individual premiums could be raised by up to $1,000.
Supporters of this initiative include the California Department of Insurance, the agency charged with overseeing insurance regulations within the state, currently helmed by Insurance Commissioner Steve Poizner. In direct opposition is the Santa Monica-based advocacy group, Consumer Watchdog, and Naomi Seligman.
She told Our Weekly that this upcoming measure is an attempt to rescind 1988’s Prop. 103 (written by Consumer Watchdog founder Harvey Rosenfield), which set rates based on good driver discounts and miles driven, as opposed to the zip code in which they reside. Seligman describes Prop. 17 as a “fig leaf” in terms of the way it is written to disguise the surcharge levied against those who cancel their coverage, even if they are military personnel shipped overseas, or civilians forced to move due to job demands. Another compelling component in this particular ballot measure is the current economic situation, which has induced some financially strapped drivers to let their insurance lapse to make ends meet.
If passed, Prop. 17 will invoke the surcharge for new drivers and those who haven’t driven for long periods, regardless of the reason.
Further complicating the issue is the Mercury Insurance Group, which diverted some $7 million to support Prop. 17. Mercury has recently been accused of criminal practices in dealings with the military and handicapped, among other groups. The San Francisco Chronicle and other publications report that Mercury has been cited by the state and the above mentioned Department of Insurance for $600,000 in penalties since 2006, for unwarranted high premium rates and other violations.