California Proposition 33

Raphael Locsin

November 7, 2012

Last night’s election will dictate our future for the next 4 years and beyond. There were many important choices to be made, one of which was proposition 33. With the budget deficit, increasing gas prices and other goods, and many more social service cuts looming, it was important for California to vote NO. Congratulations California you made the right choice. Prop 33 stated:

Changes current law to allow insurance companies to set prices based on whether the driver previously carried auto insurance with any insurance company. Allows proportional discount for drivers with some prior coverage. Allows increased cost for drivers without history of continuous coverage. Fiscal Impact: Probably no significant fiscal effect on state insurance premium tax revenues.

Those of you that voted yes are probably thinking “Oh great another insurance guy telling me I should pay more for my insurance.” At first glance you should notice how the prop is worded. While it allows for a discount to those with continuous insurance coverage, it also allows insurance companies to increase rates for those without coverage. Now this may seem fair to most of you who think “those who play by the rules should be rewarded and those that do not should be punished,” however, lets think about this in a broader perspective.

This proposition would “allow insurance companies to increase cost of insurance,” according to the Attorney General’s Official Summary—even on motorists with perfect driving records. It is a cleverly worded initiative that says one thing and does another. Beware: the California Department of Insurance has said the so-called “continuous coverage discount” scheme “will result in a surcharge” for many California drivers.
Proposition 33 would have raised insurance rates for students completing college who now need to drive to a new job.

Proposition 33 would have unfairly punished anyone who stopped driving, even if it was for a good reason, but then needed insurance again to get back behind the wheel.

Proposition 33 would have raised insurance rates for people who dropped their coverage while recuperating from a serious illness or injury that kept them off the road.

If this proposition had passed, it would have deregulated the insurance industry even further, making big insurance companies less accountable. Perhaps this is why $17 million of the funds promoting Proposition 33 was provided by Mercury Insurance’s billionaire chairman George Joseph. I say, good job California! Don’t let these billion dollar insurance companies pull one over you!

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