CALIFORNIA ELECTIONS / INSURANCE COMMISSIONER : Insurers Fatten Quackenbush’s War Chest : About 60% of his money comes from companies and agents he would regulate, if elected, compared to about 10% of his opponent’s funds.

Both major party candidates for insurance commissioner have collected campaign funds from elements of the insurance industry, but Republican Assemblyman Charles W. Quackenbush has tapped far deeper into that source than his rival, and is intensifying his efforts.

About 60% of Quackenbush’s war chest has been supplied by insurers, while Democratic state Sen. Art Torres has received less than 10% of his total from industry connections, mostly lawyers who represent insurers, according to figures supplied by the campaigns.

Quackenbush’s campaign Monday released a schedule of 35 fund-raising receptions to be attended by insurance agents with a stated goal of raising $397,750 toward a projected $1-million television advertising blitz. The receptions began in August.

A total of $107,757 has been raised for Quackenbush by insurance agents at the receptions that have already been held. Another $500,000 has come from other industry loans and contributions. Quackenbush has raised about $1 million so far.

Torres, in contrast, even according to Quackenbush’s campaign manager Greg Butler, has raised about $100,000 in industry money, out of what the Torres campaign says is a little more than $1 million that it has raised so far.

Torres said Tuesday that he has decided to send $10,000 back to Sam Presley, a New Orleans owner of an auto insurer who was ejected two years ago by California regulators. Informed that the Quackenbush campaign was questioning the donation, Torres said, “I (knew I had to) send it back, as soon as we realized who he was.”

Quackenbush’s reliance on a largely industry-funded campaign is stirring adverse comment, and not only among consumer leaders who might be expected to be critical.

A leading industry trade publication, National Underwriter, recently warned that such support could backfire against his election chances.

After the California Assn. of Life Underwriters endorsed Quackenbush, National Underwriter editorialized, “We think (the association members) are wrong to take sides in an election to choose who will regulate them for the next four years. They would have been wiser to stand by their 60-year history of political neutrality. . . .”

“The group . . . leaves itself open to charges that it is merely trying to co-opt the government official who will make critical decisions affecting the industry it represents. Any industry’s effort to influence the election of its regulator can only be viewed by the public as self-serving, if not improper.”

Harvey Rosenfield, leader of the Proposition 103 campaign against the industry in 1988, said he is more concerned about agents’ associations that have ostensibly stayed neutral, but whose members have been organizing fund-raisers for Quackenbush.

Rosenfield noted that more than half the agents’ fund-raisers for Quackenbush are asking for less than $100 a person, meaning that under state law the donor does not have to be identified.

Eleven of the 35 fund-raisers ask $99 each, just $1 under the reporting limit.

“While trying to hide its actions from public view, the insurance industry is mounting an all-out campaign to elect a pro-industry candidate to the office of California insurance commissioner,” Rosenfield said.

He also expressed alarm that a recent letter from an insurance agency executive who loaned $200,000 to the Quackenbush campaign called for other agents to contribute $50 to Quackenbush for each $1 million in premiums that they had written. If everyone complied, Quackenbush would get $3 million.

The director of another reform group, Ruth Holton of California Common Cause, said that in raising so much money from the industry, Quackenbush may be “sending out a message that he is going to be friendly to the industry” if elected.

Butler, speaking for Quackenbush, derided such statements as without foundation. He said that as an assemblyman for the past seven years, Quackenbush had occasionally defied the wishes of big contributors to vote for legislation, such as gun control and control of breast implants, because he believed it was right.

“He’ll never have a problem speaking out against the insurers when they’re doing something wrong,” Butler said.