Quackenbush Told to Appear Before Panel

A day after he stalked out of a state Senate committee hearing, California Insurance Commissioner Chuck Quackenbush on Wednesday was served with a subpoena compelling him to testify next month about his handling of Northridge earthquake insurance settlements.

Quackenbush, the first statewide elected official in recent memory to be ordered to appear before a legislative body, is expected to fight the subpoena in court.

Also Wednesday, the state Senate voted to extend the deadline for Northridge earthquake victims to file claims, and Quackenbush launched his own counteroffensive. He asked the California Highway Patrol to investigate the leaking of confidential Northridge documents from his department.

CHP Commissioner D.O. “Spike” Helmick, whose officers investigate crimes on state property, agreed to conduct the inquiry, but said he did not know how long it would take.

“We’ve done a lot of investigations in the past of other departments . . . but nothing to this degree or nature,” Helmick said.

The goal of the investigation, Department of Insurance officials said, was to determine who leaked “confidential” market surveys conducted by the department in the wake of the Northridge quake. The surveys studied how claims were handled by major insurance companies and included individual files.

“Our primary concern is the protection of people’s private information,” said Quackenbush press spokesman Dan Edwards.

Edwards said comments made by state Sen. Jackie Speier (D-Daly City) at a Senate Insurance Committee hearing Tuesday indicated that she had reviewed copies of the confidential exams.

Speier, chairwoman of the insurance committee, said she had never seen the exams, and called the accusations “more of their bogus shenanigans.”

“Why would I be jumping through all these hoops to subpoena the exams if I had them?” she asked.

The subpoena for Quackenbush to return to the Senate Insurance Committee and answer questions June 5 was approved by the Democratic-dominated Rules Committee on a 3-0 vote with the two Republican members abstaining.

The meeting of the Senate Insurance Committee is scheduled to occur one day before the Assembly Insurance Committee holds its second hearing on Northridge issues and controversial foundations the commissioner established.

Quackenbush, the target of four investigations, including two by the Legislature, refused to testify Tuesday on the advice of his defense attorney, denouncing the hearing as a “personal political ambush.”

After an hour of searching Wednesday, Senate Sergeant at Arms Tony Beard Jr. found Quackenbush at a closed-door meeting in the Capitol office of Sen. Charles Poochigian of Fresno, the Senate GOP caucus chairman.

Beard said Quackenbush recognized him as he handed him the summons and remarked, “You’ve got something for me.”

A few minutes after the Rules Committee meeting Wednesday morning, the Senate voted 32 to 1 to approve a bill giving Northridge earthquake victims an extra year to file insurance claims for damages suffered in the 1994 disaster.

The bill, SB 1899, by Senate President Pro Tem John L. Burton (D-San Francisco) went to the Assembly where easy passage is expected.

The bill is designed to provide relief to Northridge victims who were prevented from being compensated for losses by a one-year filing deadline imposed by insurance companies.

Burton said many homeowners were “misled” by insurance companies about the extent of damage to their homes. Once they learned the full extent, they were prohibited from filing damage claims because the one-year statute of limitations had run out.

The bill was supported by consumer groups, trial lawyers and senior citizen organizations. It was opposed by the American Insurance Assn. and the Personal Insurance Federation of California.

In related action, the Senate Constitutional Amendments Committee defeated 2 to 3 a proposal to change the insurance commissioner’s post from an elected to an appointed office. After the defeat, the author of the measure, Speier, announced that she was introducing legislation that would ban contributions to the commissioner from the industry he regulates.

Since taking office in 1984, Quackenbush has collected more than $6 million in contributions from the insurance industry.

In the past year, he transferred $250,000 in contributions from insurance interests to his wife’s political account so she could pay off a personal loan she made to her 1998 failed state Senate campaign. He has said she made the loan by taking a mortgage on the family home.

Speier said that if her legislation passes, California would become the fourth state--Delaware, Washington and Georgia are the others--to stop insurance commissioners from accepting campaign contributions from the insurance industry.

Meanwhile, former Acting Secretary of State Tony Miller asked Atty. Gen. Bill Lockyer to open a criminal investigation into Quackenbush’s acceptance of political contributions from insurance interests that had matters pending before his department.

Miller, now a private attorney, said campaign records show that on Feb. 9 Quackenbush got a $50,000 contribution from a Mercury General Corp. executive and a $20,000 donation from American Fidelity Life Insurance Co. At the time, he said, Mercury General and an American Fidelity affiliate were being investigated by the insurance department’s enforcement branch.

Miller said the contributions violated a California law that prevents the commissioner from soliciting or receiving a donation from a company while it is being investigated by his department.