Insurance Companies Flex Their Muscle

I can't say I'm surprised. I've just read that a group of car insurance companies are launching an "educational campaign" in California. If you don't live there, you might not be aware of what's going on: you see, Insurance Commissioner John Garamendi is bringing in new regulations, and it would appear that the insurance companies don't like them.

The insurance industry is a big and powerful lobby in the US. Don't kid yourself: they aren't really on the consumer's side, even if they say they are. Why? Because you, their upstanding client who pays your insurance bill promptly, can turn into an insurance problem overnight. How? You file a claim, and actually want to "collect" on the service that you've been paying for all along!

It's a weird relationship that we have with insurance companies.

Back to California: Garamendi is proposing some new regulations that would take some of the mystery out of how an auto insurer calculates your premium. The new regulations would require that your insurance be based on your driving record, in combination with the number of miles you drive a year and the number of years that you've been driving. Other things, like the area where you live, would become secondary. However, insurers don't want to give up determining premiums according to their own rules -- and that's where the fight is coming from.

I'll be interested to see how this turns out. After all, Garamendi faces two challengers in the June 6 Democratic primary for lieutenant governor. We'll see if the insurance lobbying keeps him from getting the new position.

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