State Plans Hearings on Insurance Rates

The California Department of Insurance has called a series of seven public hearings beginning Aug. 13 to investigate whether recent sharp increases in liability insurance rates are in accord with state law, and whether changes in the law regarding rates are merited.

In announcing the hearings for San Francisco and Los Angeles, a department statement said they were one step toward fulfilling a program announced by Gov. George Deukmejian on June 10 to deal with the insurance pricing crisis.

Representatives of the insurance industry, rating research organizations, public officials and interested members of the public are invited to testify at the hearings. All those wishing to appear are asked to notify department counsel John Faber by Aug. 11.

Hearing Topics

The first three hearings, Aug. 13-15 in San Francisco, will deal, respectively, with the liability situation regarding commercial automobiles, businesses including apartments and condominiums and, finally, manufacturers and contractors. Four other hearings, Aug. 20-22 and Aug. 26 in Los Angeles, will deal, respectively, with commercial automobiles, businesses, professions and, finally, municipalities and other governmental entities.

California’s Little Hoover Commission reported recently that commercial liability insurance rose by 81% in California during 1985, and that 84 cents of every dollar paid in premiums was going to pay either lawyers and the cost of litigation or insurance company overhead or commissions.