Insurers Backing Prop. 213 With Big Contributions

The insurance industry has poured $1.4 million in contributions into a state initiative sponsored by Insurance Commissioner Chuck Quackenbush that would limit damage claims by uninsured drivers, drunk drivers and fleeing felons.

The industry’s gifts to the Proposition 213 campaign constitute almost 90% of the total raised so far--$1,421,260 out of $1,585,701.

A consumer group headed by insurance industry foe Harvey Rosenfield said that with the new contributions, the industry has given $4,060,723 to Quackenbush-controlled committees since Jan. 1, 1994.

But on Tuesday, Quackenbush and 213 campaign manager Rex Frazier said it was unfair to lump the Proposition 213 contributions with the others, which went mainly to Quackenbush election campaigns.

Quackenbush said: “Campaign contributions raised to pass Proposition 213 are not contributions solicited for me, but are to help pass an initiative that will protect law-abiding citizens and will demand that people who break the law be held accountable.”

Frazier added: “The commissioner and the initiative are separate. He has made it a priority among many activities, but what does the money he has raised in his personal political committee have to do with the money raised for 213? I absolutely reject the connection.”

Quackenbush, 42, was elected insurance commissioner in 1994. He was the state’s second elected commissioner and the first Republican, and he ran on a platform of improved relations with the industry and a less-regulated insurance market.

Proposition 213 would prohibit several million uninsured motorists and 250,000 drunk drivers convicted annually from collecting noneconomic damages such as pain and suffering from auto accidents, and would prohibit a much smaller number of fleeing felons from collecting any damages.

A Rand Corp. study has estimated it would save insurers 10% of their damage payouts.

The three largest contributions to the Proposition 213 committee were $110,000 from the Farmers group of insurance companies, $100,000 from Mercury General and $100,000 from State Farm.

Spokesmen for all three companies strongly defended the contributions Tuesday as good for their policyholders, because, they said, passage of Proposition 213 will lower claims and lead to lower premiums.

“Any company should do what it can to reduce premiums, which are high enough,” said Mercury Chairman George Joseph. He said a nine-year trend toward declining premiums has largely resulted from court decisions and other restrictions on liability claims.

“It in fact takes costs out of the auto insurance system,” said Jeffrey Beyer, a spokesman for Farmers.

Campaign manager Frazier said the remaining 10% in contributions include 1,100 separate gifts “from people in everyday life.”

Opponents of the initiative contend it is unduly punitive on those who cannot afford auto insurance and does not guarantee lower rates for policyholders as a result of the savings.