California Proposition 33: Auto insurance continuous coverage discount
LOS ANGELES (KABC) -- California Proposition 33 would reward some drivers with auto insurance discounts. But opponents claim a different group of drivers would be punished as a result.
It's called a "continuous coverage discount." It would be offered to drivers who have been insured continuously for five years or more. And under Proposition 33, that discount could be transferred from one insurance company to another.
"The point of the initiative is to reward those drivers who have maintained coverage," said insurance agent Joe Jimenez.
Jimenez an independent insurance agent in Orange County. He says Proposition 33 would be good news for consumers who are interested in switching insurance companies while maintaining their loyalty discounts.
"When companies compete for your business, the consumer wins," said Jimenez. "Under current conditions, that's not happening."
But opponents of Prop. 33 say it has nothing to do with offering discounts to responsible drivers. They say the measure would punish motorists who have legitimate reasons for letting their insurance coverage lapse.
"The claim in the Prop. 33 ads that Prop. 33 would give drivers discounts, just let them take their discount with them, is simply false," said Carmen Balber, spokeswoman for nonprofit group Consumer Watchdog.
Balber says Prop. 33 would overturn an existing state law that prohibits increasing the cost of insurance for drivers who have not been insured continuously.
"For an insurance company to give one person a discount, they have to pay for it with a surcharge from someone else," said Balber.
But Jimenez says Prop. 33 will make provisions for active duty military and for certain unemployed drivers.
"There are several programs out there for low-income drivers that can also serve as prior insurance," said Jimenez.
Balber says the discounts are disproportionate.
"It allows insurance companies to create a new small discount for some that will result in a massive surcharge for drivers, even if they have a perfect driving record," said Balber.
George Joseph, founder of Mercury Insurance, has spent millions to pay for ads in support of Prop. 33.
Jimenez says Prop. 33 will allow Mercury to compete against larger companies. And he says that's good news for consumers.
The general election is on November 6, 2012. Your vote can help decide many important issues for California. Over the next few weeks, Eyewitness News will focus on the propositions on the November ballot.
election, politics, robert holguin
- Vandals break in, trash church in Palmdale
- Machete-wielding man shot by Inglewood police
- Greuel, Garcetti rally for undecided voters
- Body found near area where hiker went missing
- Deputies shoot, kill armed man during fight
- IE woman punches officer, tries to take Taser
- Suspect killed in Alhambra PD station ID'ed
- Simi Valley attack may be gang-related, police say
- Calif. law takes effect on microstamping guns
- NorCal beach parking fee fight gets heated
- Obama addresses Morehouse College graduates
- abcnews: 1st lady jokes about president's failures
- 'Star Trek' tops box office with $70.6M debut
- OTRC: Billboard Music Awards 2013 nominees list