Tag Archives: Prop 17

California, Election 2012

Mercury Insurance Gave $25K to Greenlining Institute for Flip-Flop Prop 33 Endorsement

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Consumer Advocates Call On Group To Withdraw Support For Measure That Would Raise Car Insurance Rates on Good Drivers

The nonprofit Greenlining Institute acknowledged in a San Francisco Bay Guardian story published today that it received a $25,000 donation from Mercury insurance company, and expects more for its work in support of Mercury-backed Proposition 33. Prop 33 is funded by Mercury insurance’s billionaire chairman George Joseph and would raise car insurance rates on good drivers who have a break in insurance coverage, even if they’re not driving.

In a letter, Consumer Watchdog urged Greenlining to reverse its decision to support Proposition 33. Greenlining opposed a nearly identical ballot measure proposed by Mercury insurance company in 2010, Prop 17.

Download the letter here

Read the San Francisco Bay Guardian story

“We are writing to urge you to reconsider your shocking support for Proposition 33 and the auto insurance redlining it seeks to legalize,” wrote Consumer Watchdog founder Harvey Rosenfield and Washington DC director Carmen Balber. “Greenlining purports to represent the very low-income drivers who will be hurt the most if Proposition 33 is approved next November, allowing insurance companies to surcharge Californians who stop driving for legitimate reasons and then choose to get back on the road.”

Prop 33 would overturn a 24-year-old law banning discriminatory practices by auto insurance companies that were brought to light in the 1987 California civil rights case, King v. Meese.

“The rampant practice of surcharging, or refusing to sell insurance to, people who were not previously insured was one of the most pernicious of the discriminatory techniques employed by the insurance industry,” said the letter. “In signing the ballot argument for Proposition 33, you have aligned yourself with George Joseph and Mercury Insurance, the most persistent partisans for the legalization of the old redlining tricks that made auto insurance inaccessible to low-income families and communities of color for decades.”

The letter notes that Proposition 33 targets Californians who stop driving for legitimate reasons:

  • When low-wage workers who commute by bus need to get a car in order to maintain their job, they will be surcharged by about 40% for auto insurance;
  • When immigrant drivers are finally able to obtain a California driver’s license and try to buy insurance, they will be forced to pay hundreds and possibly thousand of dollars more than the drivers who purchased insurance in the past, even though they are equally good drivers;
  • When drivers who have found it financially impossible to maintain uninterrupted insurance coverage turn to the auto insurance market in hopes of complying with the mandatory insurance law, they will face a financial penalty for being poor;
  • Those who cannot afford these massive surcharges will be exposed to penalties and seizure of their vehicles for failure to comply with the Financial Responsibility Law.
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Mercury Insurance: Spending Money to Lose Money

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This basic theme is really elemental, and puts the lie to Mercury Insurance’s claims that they are trying to save consumers money.  Here’s the situation, stated as simply as possible.

  • Mercury Insurance is a big auto insurer whose goal is to make a profit.
  • Mercury Insurance has given over $3.5 million for the initiative, most of the funding to get Prop 17 on the ballot and the campaign up to this point.
  • Mercury says they want to be “able to offer a discount” to drivers with continuous coverage, but won’t charge more for those without that continuous coverage. Thus, they would make absolutely no money off the initiative, and would actually lose money.
  • See #1 about their goals as a business.

    • Now, why exactly would somebody believe this? That they are spending $3.5 million to save their customers money?

    In actuality, they want to be able to force people to keep up insurance while they are away from their cars.  Soldier who is out of the country on deployment? Better keep that insurance or you will face jacked up rates when you come home. Move into the city and don’t need a car? Better keep that insurance or you will face jacked up rates in case you change to a job that requires a car commute.

    Enjoy the video and pass it around. Once people see the logic they are trying to sell, they’ll swat this away.

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    PropScaping the Initiatives

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    The courts resolved a slew of disputes about the initiatives over the last few days.  As we mentioned recently, Prop 14, the “open primary” measure that would result in a lot more Dem-on-Dem fights, was the subject of much legal wrangling.

    In the end, Prop 14 will largely stay the same:

    Gov. Arnold Schwarzenegger and other supporters said they beat back an effort by union officials and lawmakers to undermine the proposal that would allow Californians to vote in state primaries regardless of candidates’ or voters’ party affiliations.

    *** *** ***

    The governor and state Sen. Abel Maldonado (R-Santa Maria) intervened to stave off the changes. Superior Court Judge Allen Sumner ruled Friday that voters should see the measure very much as it was originally written. Sumner made minor changes to the wording regarding potential costs related to an open primary and made clear that voters would not have to state a party preference. (LA Times)

    Meh, the language that was passed during the budget fight was passed at Maldonado and Arnold’s gunpoint. It should have been changed, but them’s the breaks. It means that more resources will need to be spent to beat this stinker.  As of right now, it looks like both major parties will officially oppose the measure.

    On Prop 17, Mercury Insurance’s hidden agendas scheme against Prop 103, the court ruled that ballot arguments will stand:

    Judge Allen Sumner has upheld Attorney General Jerry Brown’s Official Title and Summary of Proposition 17, which warns the measure will allow car insurers to raise premiums.  The ruling means voters will learn in the ballot pamphlet that Prop 17 will allow insurance companies to raise rates on California drivers based on their history of buying auto insurance.

    Attorneys for Mercury Insurance failed as it tried to convince the court to remove any reference to the insurance surcharges that Prop 17 will create.  Consumer advocates hailed the decision as a victory for voters, who will have the opportunity to cut through Mercury’s multi-million dollar campaign of lies and read a fair assessment of the insurance company’s initiative in the Voter Guide.

    “When voters face the deceptive, multi-million dollar insurance company ad campaign for Prop 17, at least they’ll be able to turn to Attorney General Brown’s summary to learn the truth,” said consumer advocate Harvey Rosenfield who co-authored one of the ballot arguments against Prop 17.  “Now that the Judge has made it clear that Prop 17 lets insurance companies raise car insurance premiums, will the insurance company backers of Prop 17 stop lying about it?” (Press Release)

    Now, the ballot arguments aren’t nearly as important as the ballot title and summary, but every little bit helps.

    Speaking of the initiatives, if anybody has a point for the Calitics Editorial Board to consider for these things, let us know. We’ll be doing endorsements soon.