California Insurance

California regulatory authorities means today, 14 major insurance companies for reimbursement of more than $ 1.5 billion on consumers under the initiative of a ballot during the last three years.

But insurers have indicated that they would take up the challenge, through an administrative procedure and the consultations before the courts, so it is unlikely that consumers get money in the near future.

Orders have been recent efforts by California’s Insurance Commissioner John Garamendi, the ballot papers for the initiative, known as Proposition 103, entered into force. Important elements of the initiative, long stalled by the insurers’ legal opposition. Répété its arguments today that Mr. Garamendi actions would deny them a fair weight in the affairs of their activity CA. Formula insurance

Mr. Garamendi in August said he would transmit the request for 2.5 billion dollars are awarded and mandates it today for the first time that the State is of the opinion different insurers through their clients.

Other insurers receive orders discount calculated as regulators under a formula developed by Mr. Garamendi staff. The formula takes into account an insurer, prices and profitability, and who apply for restoration of auto insurance policies and other materials accidents and political force in 1989.

Mr. Garamendi ordered State Farm Mutual Automobile Insurance Company, the largest auto insurer in California, to repay consumers $ 234.6 million or 7.7 per cent of 3.06 billion in premiums the company gathered the year 1989. The Allstate Insurance Company was to repay $ 243.6 million or 13.1 percent of 1989 premium income of 1.87 billion dollars.

Other insurers are California State Automobile Association, the Automobile Club of Southern California, 20 Century Industries, Aetna, Mercury General, United Services Automobile Association, Cigna, Nationwide Mutual Insurance, Safeco, Trans America, Progressive Insurance Fund and Geico.

Most insurers, the challenge that the first draft of the order of passage in the administration of hearings before the division of insurance. If orders are confirmed by the hearings, insurers, it is probably file appeals argue that rates the restoration of their right, “said the Tribunal earlier cases, Proposition 103, deserve an adequate return.

“We do not believe our experience we had in California with a reasonable return, and we are confident that the courts of California to reject the order of the Commissioner, Allstate said in a statement. Complaint by State Farm

State Farm, said the regulatory authorities’ financial analysis was wrong.

“It is true that the company had no connection with the accuracy of calculations of the Commission, a good assessment of actual results and results would show that State Farm has suffered a loss operational in California in 1989 and its return on equity was well below the unreasonable low default rate in resolving “State Farm said.

But Mr. Garamendi was elected the first state insurance commissioner in the year, reflecting in part on the basis of the campaign promises the establishment of a rate of operation, said the industry could be the legitimate anger of consumers, if it did not agree immediately on discounts.