No-Fault Initiative

Your story (Part I, May 25) on the filing of the insurance industry’s initiative left out some important facts. The industry is calling this the “no-fault” initiative. But that’s just its cover for other provisions hidden in pages of fine print.

The industry’s initiative is a wish list. In addition to enacting a no-fault plan with skeletal benefits, the initiative would:

- Make it impossible for California to regulate insurance rates.

- Make it impossible for the Legislature to apply antitrust laws to the business of insurance.

- Authorize anti-competitive laws which make it illegal for insurance agents to give consumers discounts.

The above is the short list of the initiative’s provisions. The 120-page initiative is full of anti-consumer, pro-industry provisions. If the insurance industry’s initiative passes, these provisions could only be changed by a two-thirds vote of the Legislature or another initiative. Either way a proposal for change would undoubtedly face stiff industry opposition.

One thing that is bigger than Mt. Everest is the insurance companies’ lie about its “no-fault” initiative being like the pro-consumer New York law. This initiative is nothing like the New York program. In fact, in negotiations with consumer groups, the industry has consistently refused to accept the New York no-fault system. Perhaps this is because New York also has one of the best regulatory systems in the country and has had an average annual increase in auto insurance rates of only 4%, according to the New York State Department of Insurance.

It’s important that the veil covering the “no-fault” initiative be removed.

JUDITH BELL

Director of Special Projects

Consumers Union

San Francisco