‘Voter Revolt’ Insurance Initiative Sign-Up Lagging

Sponsors of the proposed “Voter Revolt” insurance initiative backed by consumer advocate Ralph Nader said Tuesday that they are in a “desperate situation,” 100,000 signatures short of the number needed to be sure that the measure will qualify for the November ballot. The deadline for submitting signatures is three weeks away.

Coordinators for the initiative, which would roll back auto insurance rates, as well as other liability rates, by 20% and later give good drivers a permanent 20% discount, said that unless they are able to raise $50,000 immediately for paid petition circulators, their chances of qualifying are “very low.”

Although Los Angeles City Atty. James K. Hahn appeared at a news conference to give the initiative his support and a $5,000 check, neither of the coordinators, Bill Zimmerman and Harvey Rosenfield, explained how they plan to raise the other $45,000.

The “Voter Revolt” initiative is the only one of five currently being circulated that is not directly financed by either insurer or trial lawyer interests, and its failure to qualify for the ballot might open the way for the rival interests to make a deal that would offer some modest changes in insurance law to the Legislature while they scuttled the remaining initiative efforts.

It was confirmed Tuesday by both sides, the insurers and trial lawyers, that they have recently resumed negotiations looking toward such a solution.

J. Gary Gwilliam, president of the California Trial Lawyers Assn., said, “The doors are open again and there are some discussions going on. . . . I don’t want to say that we’re going to settle or not, but everybody wants to take a shot at trying to work this out.”

However, Gwilliam said the trial lawyers are holding to the position, ratified again at a Monday night meeting in Los Angeles, that the no-fault auto insurance system being pushed by the insurers must be totally abandoned in any compromise deal.

But an insurance industry spokesman said that after a daylong meeting Tuesday in San Francisco, insurers had decided for now to stick with no-fault--an idea they already have spent more than $3 million promoting.

No-fault restricts lawsuits and allows accident victims to recover damages from their own insurance carriers, regardless who is at fault in an accident. It would mean sharp decreases in trial lawyer income.

Meanwhile, state Sen. Alan Robbins (D-Van Nuys), chairman of the Senate’s insurance committee, said the efforts are continuing to push an insurance bill being negotiated between the Consumers Union and the insurance industry, and that he hopes to announce the details Thursday. This bill would include no-fault.

A complicating factor in the negotiations is the announcement this week by coordinators of an initiative sponsored by Assemblyman Richard Polanco (D-Los Angeles) and some elements of the insurance industry that they will file 610,000 signatures--far more than the number needed to qualify for the ballot--with county clerks next Monday.

Strongly Opposed

The Polanco initiative, which would cut bodily injury liability auto premiums by 50%, while limiting some kinds of damage recoveries by victims, is strongly opposed by the trial lawyers. If it is filed, trial lawyer leaders have said they would feel constrained to go ahead with the initiative they support, and that would probably prompt the insurance industry to file its two main initiatives.

But trial lawyer President Gwilliam said Tuesday that he had talked to a leading insurer backing the Polanco effort and that he felt the Polanco coordinators “may hold off” until it is clear what will happen with the trial lawyer-insurer negotiations.

Rosenfield, the “Voter Revolt” coordinator, said that to him the meaning of all these developments is clear. “The trial lawyers and the insurers would love to make a deal and leave the consumers in the lurch,” he said. “Their hope is we will not get enough signatures and therefore there will be no genuine reform on the ballot.”