Gillespie Appeals Decision to Let Allstate Increase Rate

Declaring that a Los Angeles judge had improperly interfered with her attempts to administer Proposition 103, Insurance Commissioner Roxani Gillespie on Thursday asked the 2nd District Court of Appeal to block the judge’s ruling.

The commissioner asked that, pending a hearing in the matter, the appellate court stay a 40% rate increase that Superior Court Judge Miriam A. Vogel on Monday allowed Allstate to impose Jan. 2 on “bad drivers” among its assigned-risk customers.

“A stay is required in that if Allstate’s drivers are unable to afford such an increase, it is likely they will be forced to abandon their cars and potentially their jobs or to drive without insurance and suffer the consequences,” Gillespie’s lawyer, Dana Carli Brooks, said in her 14-page appeal.

“The law must be allowed to operate, and the Superior Court has no power to interfere with the proper administration of state agencies by state officials until such time as all administrative remedies have been exhausted,” Brooks argued.

Before Monday’s court decision, Gillespie had imposed an auto insurance rate freeze on all companies in an attempt to encourage them to cooperate in quick implementation of Proposition 103, adopted by the voters last year.

Gillespie’s lawyer contended that unless the appellate court intervenes, “there is an extreme danger that this Superior Court and other Superior Courts may issue orders with the similar effect of preventing the commissioner from performing her official duties and administering the regulatory scheme she has created for the implementation of Proposition 103.”

The appeal is only against the Allstate increase. Gillespie is attempting to administratively negate another order issued by Vogel allowing the Farmers group of companies to implement an average 5.9% increase for all 2 million of its customers statewide.