KABC Flubs Prop. 103 Story, Cites ‘Confusion’ Over Ruling

KABC-TV Channel 7 was first on the air with the Califronia State Supreme Court’s verdict on Proposition 103 Thursday, but the station’s hurried and unscheduled initial report got it wrong.

KABC interrupted its morning talk show, “A.M. Los Angeles,” and mistakenly reported that the Supreme Court had “struck down as unconstitutional” the 20% rollback called for by the initiative that was approved by voters last November.

After KNBC Channel 4 and KCBS-TV Channel 2 broke into their own regular programs a few minutes later and reported that the Supreme Court had in fact upheld the rollback, KABC reporter Mark Coogan again interrupted the station’s usual programming to correct the error--about 20 minutes after his first report. Coogan did not mention that his earlier statements had been inaccurate.

KABC news director Roger Bell attributed the mistake to the complexities of the court decision and the still-uncertain future of insurance premiums.

“Our initial report was technically incorrect on that one point, but there is still a lot of confusion over the ruling,” Bell said in an interview. “The court upheld the rollback, but really, when you look at it, they did and they didn’t. The insurance companies are hailing it as a victory for them.”

Even though the court ruled against the insurance industry by refusing to strike down as unconstitutional the 20% rate rollback called for by Proposition 103, Bell said that there was still great confusion over whether consumers would ever see a reduction in their insurance premiums.

The confusion stems from the court’s rejection of a provision in the proposition that allowed exemptions from the rollback only if an insurer could show a “substantial threat of insolvency.” The court said that the provision was too stringent and that insurance companies could avoid the rollback by proving that they would not be earning a “fair return” at the lower premiums.

Though most early news reports nonetheless hailed the court’s decision as a victory for consumers, Bell insisted that his station’s inaccurate report will probably end up being closer to the truth.

“The bottom line,” Bell said, “is that we may end up being correct because the rates might not ever go down. I think we’re all going to have to wait awhile before we start spending any of that extra money.”