Ban on Insurance Race Donations Faces Hurdle

A bill to ban most insurance industry campaign contributions to the insurance commissioner cleared its first legislative hurdle Wednesday but seemed unlikely to proceed further this session.

The measure written by Sen. Quentin L. Kopp (I-San Francisco), won approval of the Senate Reelections and Apportionment Committee, but Sen. Herschel Rosenthal (D-Los Angeles), who provided the vote by which the bill passed, served notice that he might not vote for it on the Senate floor.

Rosenthal has reportedly been approached by Senate Democratic Leader Bill Lockyer of Hayward, who objected to the bill on the grounds that the contribution ban would be a violation of the U.S. Constitution guarantees of free speech.

Without the support of Lockyer, any such legislation probably stands little chance of success. Lockyer in the past has solicited insurance industry contributions.

The Kopp bill was strongly backed Wednesday in testimony by consumer advocate Harvey Rosenfield, the Consumers Union and others who have opposed the insurance industry. They noted that the present insurance commissioner, Chuck Quackenbush, has received more than $6 million in industry contributions.

Quackenbush took no position on the bill Wednesday.

The bill would bar any company or agent that is regulated by the commissioner or attorneys who represent them from making campaign contributions to an incumbent commissioner or a candidate for the job.

But insurance lobbyists suggested that the bill would be unfair, creating an unlevel playing field, if it did not also bar trial lawyer and other special interest contributions.

Kopp said that of the 11 states besides California that have elected insurance commissioners, four--Delaware, Georgia, Montana and Washington--ban industry contributions. The Georgia bill, which also bans contributions to other regulatory officials from companies that are regulated, has been upheld in court.