LOS
ANGELES, July 15, 2024 /PRNewswire/
-- Consumer Watchdog called on the Department of Insurance to
stop erecting roadblocks to public oversight and confirm the
organization's eligibility to challenge excessive insurance rates
and abusive practices on behalf of consumers without further
delay.
The Department of Insurance halted approval of Consumer Watchdog
as a consumer representative and sought insurance industry comment
on whether the organization qualifies to represent consumers before
the Department of Insurance.
Read the organization's response brief submitted to
the Department of Insurance.
The department's recent actions depart from the law, said the
brief.
Consumer Watchdog's "Request for Eligibility" filed on
June 3, 2024 complied with all the
requirements of the regulation. Department staff confirmed the
application was complete on June 17
yet delayed ruling. The sole purpose of a request for finding of
eligibility is to obtain a preliminary determination that a person
or organization does in fact represent consumers. No previous
commissioner has ever sought industry opinions on who represents
consumers.
Consumer Watchdog has previously been confirmed as a consumer
representative by the Department of Insurance 15 times, including
in 2022 by Insurance Commissioner Ricardo
Lara.
"Consumers need a voice at the Department of Insurance now more
than ever before as insurance companies refuse to sell in many
parts of the state and seek double-digit rate increases everywhere
else, including an extraordinary 30% rate hike request made by
State Farm last month," said Carmen Balber executive director
of Consumer Watchdog.
Consumer Watchdog has saved insurance policyholders
$6 billion by challenging
excessive insurance rates since 2002.
The insurance lobbying group Personal Insurance Federation of
California (PIFC) acknowledged
in comments filed with the Department that the organization is
targeting Consumer Watchdog for its advocacy on behalf of consumers
in the broader "legislative and regulatory negotiations" regarding
the "California insurance
market." The insurance industry seeks to punish Consumer
Watchdog for, as PIFC head Rex
Frazier told Politico, its "bad behavior." Frazier was
Deputy Insurance Commissioner under former Commissioner
Chuck Quackenbush when he attacked
the intervenor system before being forced out of office in an
insurance pay-to-play scandal.
"It is not up to the industry to decide whether a consumer group
represents the interests of consumers, and a finding of eligibility
certainly does not hinge on whether the insurance companies or the
Department agree with a consumer group's positions," said the
brief.
16 public interest organizations also responded to the attack on
public participation by submitting letters to the department. A
coalition letter expressed, "our deep concern with recent
Department of Insurance actions that create new extra-regulatory
hurdles to independent public scrutiny of insurance rates,
regulations, and enforcement of the state's insurance consumer
protection laws."
The groups signing the coalition letter include: 350 Bay Area,
California Public Interest Research Group (CALPIRG), Center for
Biological Diversity, Consumer Attorneys Association of
Los Angeles (CAALA), Consumer
Federation of America, Consumers for Auto Reliability and Safety,
Food & Water Watch, FracTracker Alliance, Life Insurance
Consumer Advocacy Center, Public Advocates Inc., Public Citizen,
Rise Economy, The Protect Our Communities Foundation, and TURN-The
Utility Reform Network. Read the letter.
The University of San Diego Consumer
Protection Policy Center at the Center for Public Interest Law, and
the Consumer Attorneys of California, also submitted
letters. Read the
CPPC and CAOC letters.
"Targeting notices of objections towards the insurers that often
seek faster rate increases is of great concern to consumer
protection. The additional queries of eligibility to seek
compensation by the most active consumer protection intervenors can
only lead to further discouragement of intervenor participation
designed under Proposition 103," wrote the Consumer Protection
Policy Center.
Voter-approved insurance reform initiative Proposition 103
created a "public intervenor" process to give consumers a voice in
insurance rate oversight and encourage public participation.
Intervenors provide the Insurance Commissioner independent outside
expertise and act as a check on the Department if a Commissioner
fails to act in consumers' interests.
For more information on the public participation process read
the study, "How Citizen Enforcement of Proposition 103 has
Saved Californians $5.5 Billion – and
Why the Insurance Industry Hates It."
View the history including letters submitted by then insurance
industry here.
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SOURCE Consumer Watchdog