Insurers File 700,000-Name Petition for No-Fault Measure

The California insurance industry Tuesday filed more than 700,000 signatures with county clerks to qualify for the November ballot its initiative to install a no-fault auto insurance system in the state.

Insurance industry spokesman John Crosby said that gathering the signatures on a hurry-up basis after a state appeals court invalidated an earlier version of the no-fault initiative had cost the industry $1.3 million. This figure brings to more than $4 million the amount the industry acknowledges spending on the campaign thus far.

Under no-fault, many of a policyholder’s accident losses are paid by his own insurer, regardless of whose fault the accident is. Damage recoveries for pain and suffering are restricted, as is the right to sue, except in cases of serious and permanent injury.

Crosby called it “a tested solution that has worked in Florida and New York to curb auto insurance rates by removing lawyers from the small-claims process in minor accident cases. . . . Twenty-six percent of every liability premium dollar goes to feed lawyers. It shouldn’t have to, and that’s what no-fault is all about.”

But J. Gary Gwilliam, president of the California Trial Lawyers Assn., responded that the no-fault proposals are “self-serving, self-perpetuating vehicles designed to protect and enhance multibillion-dollar profits.”

Noting that the industry initiative also contains prohibitions on rate regulation and other measures, Gwilliam charged that it “contains literally hundreds of anti-consumer provisions designed to protect the industry and shaft the insured.”

Tuesday’s filing of signatures was the fourth for an insurance initiative. The trial lawyers are sponsoring a rate-regulation initiative, consumer advocate Ralph Nader is backing another, and insurance interests are supporting a fourth, which would roll back bodily injury liability premiums while restricting damage recoveries.

The insurers plan to submit 550,000 signatures for a fifth initiative, to slash trial lawyers’ contingency fees, later in the week.

None of the initiatives have formally qualified. The secretary of state has 30 days after the filing of signatures to report on whether the required 372,178 valid ones have been submitted.

Meanwhile, an initiative to restore California’s Cal/OSHA worker safety program qualified Tuesday for the Nov. 8 ballot, the secretary of state’s office announced. The initiative, spearheaded by organized labor groups, would ensure funding for Cal/OSHA, which was dismantled last year by Gov. George Deukmejian, a longtime critic of the job safety agency.