New Insurance Chief Sees Duty to Protect Public

Gov. George Deukmejian’s appointee as the new state insurance commissioner said Saturday that despite being an insurance company official for 10 years before coming to the Department of Insurance in 1983, she sees her role as commissioner as clearly being “to protect the public, to protect the policyholder” rather than insurance industry interests.

Roxani M. Gillespie said that under an agreement last week with legislative aides, the Insurance Department will be adding $1 million to its $24-million budget for the next fiscal year for the purpose of augmenting its consumer services.

Gillespie said a toll-free 800 telephone line will be added to receive consumer complaints, more staff will be hired in an attempt to reduce complaint backlogs and more comprehensively monitor insurance company conduct and that consumer informational materials for the public will be increased.

Assigned-Risk Plan

But Gillespie was quick to back off from outgoing commissioner Bruce Bunner’s call Thursday for the Legislature to grant the insurance commissioner authority to establish an assigned-risk plan for liability insurance and to compel, if necessary, the companies wishing to do business in California to participate in it. Under assigned-risk plans, a party unable to buy insurance elsewhere is assigned a company by a central authority and the company must sell the party a policy.

Bunner said that with the passage of Proposition 51 Tuesday, there was no longer any excuse for companies to refuse to sell policies to cities and other liability buyers.

Bunner’s sudden resignation was accepted by Deukmejian Friday, one day after Bunner made public his assigned-risk liability proposal. Although Bunner said he had told the governor earlier in the year that he wished to resign, he said he had not been informed that his resignation would be accepted Friday.

As soon as Bunner had made his proposal, a spokesman for Deukmejian disassociated the governor from it, saying Deukmejian was still studying the matter.

Gillespie said she will reserve statements on the question of compelling companies to sell liability insurance until after Deukmejian speaks out on that issue. “I have to wait for him,” she said. “He’s our boss.”

Consumer Hot Line

She added, however, that she will continue the monitoring by departmental aides of municipal and commercial liability insurance availability that Bunner had ordered Thursday. She said she intends to establish a consumer hot line--separate from the 800 line--to provide information as to which companies are ready to sell such insurance.

There was some uncertainty Saturday over when Deukmejian will speak out. Gillespie said she had been told the governor has prepared a major speech on insurance issues and would deliver it to a California League of Cities meeting in Sacramento Monday. But the governor’s deputy press secretary, Kevin Brett, said that the governor’s speech to the group is not until Tuesday and even then it is not certain that Deukmejian will address the insurance question.

Deukmejian policies have appeared hesitant in recent months on insurance issues. For instance, on March 25, a senior aide to the governor--the secretary of the Business, Transportation and Housing Agency, John K. Geoghegen--said that the State Insurance Department would shortly announce a series of public hearings around California on whether insurance rates were excessive. However, two and a half months later, these hearings have still not been set.

Gillespie, 45, was the vice president of the Industrial Indemnity Co.’s San Jose Division for five years before becoming chief deputy to Bunner at the Department of Insurance in 1983. She had earlier served as corporate counsel and senior attorney for the insurance company.

Ties to Industry

Consumer critics of the Insurance Department have long pointed out that most commissioners seem to come to the department from the industry and then return to the industry after completing their service. This, they say, gives them an industry slant.

Gillespie said, however, that she believes her insurance company background is an asset. “I don’t think you can regulate the industry unless you know it fully,” she said. “I have worked inside the industry, and it won’t be easy for the industry to pull the wool over my eyes.”

In the meantime, Los Angeles Mayor Tom Bradley, Deukmejian’s opponent for governor, continued his criticism of Deukmejian’s handling of the Bunner matter and insurance issues in general.

At a news conference at City Hall, Bradley questioned whether “insurance industry friends” who have given Deukmejian $709,000 for his reelection effort engineered Bunner’s removal in the wake of his moves to increase state regulation over the insurance companies.

Bradley said he had been proposing the very kind of mandatory requirements of the insurance industry that Bunner backed Thursday since last April and that it should not be taking Deukmejian so long to come to that position.