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Lawmaker Wants to Void Limits on Insurance Plan

<i> From a Times Staff Writer</i>

As tough new restrictions take effect today on the state’s Fair Plan for earthquake and homeowners insurance, a state lawmaker moved Friday to cancel the limits, which were ordered by state Insurance Commissioner Chuck Quackenbush.

The Fair Plan is the state-operated insurer of last resort for homeowners unable to buy policies elsewhere. Under Quackenbush’s order, the only new sales permitted will be in brush-fire and low-income areas where insurance has always been hard to buy.

State Sen. Herschel Rosenthal (D-Los Angeles), chairman of the Senate insurance committee, charged that Quackenbush’s restrictions would, if permitted to continue, cause an availability crisis.

He proposed that Quackenbush’s action be voided and the Fair Plan be allowed to continue to grow up to 6% of the insurance market from its current 3% share.

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The Rosenthal proposal would require two-thirds margins in both houses of the Legislature and Gov. Pete Wilson’s signature to become law.


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