The American Agents Alliance announced it has submitted for title and summary an automobile insurance discount initiative that would allow consumers to receive a discount for having continuous automobile insurance, regardless of the insurance company with whom they are insured.
Presently, the law allows only the company where you are already insured to offer a “persistency” discount. The Agents’ Alliance’s initiative is similar to Proposition 17, which lost by 2 percentage points in the 2010 election, in allowing consumers to take their “persistency” discount with them and shop for better coverage and lower rates with other insurers.
“The way the law is written now rewards insurance companies,” said Mike D’Arelli, executive director of the American Agents Alliance. “We believe that giving the consumers control over their discounts will increase competition between insurance companies, lower costs, and insure more people.
“After listening to the voters, our clients, and even our opposition, we realized that the new initiative needed to be written with greater clarity,” D’Arelli continued. “There are new provisions that protect the continuous coverage history of our men and women in the military, those who suffered from the economic downturn, young drivers on the cusp of leaving home, and allowing proportional coverage for the whole years in the preceding five years in which a person was insured.”
The Alliance expects to not only have the same support it received on Prop. 17, but it has begun working with USAA Insurance, the military insurance company, and others who opposed the 2010 effort.
Last year, Consumer Watchdog opposed Prop 17, saying it would have resulted in a surcharge for certain drivers, including soldiers, seniors, small business owners and middle-class families who have had a lapse in car insurance coverage for any reason during the past five years. The consumer group believed people who stopped driving and didn’t need insurance for a time would be required to pay hundreds of dollars more when they sought to restart coverage.
The Agents Alliance, however, believed that Prop 17 would have made the auto insurance market more competitive, offering drivers more choices and leading to lower rates for millions of California drivers.
Once a title and summary for the current initiative is drafted by the attorney general’s office, proponents will have 150 days to collect and submit the 504,760 valid voter signatures needed to qualify for the next statewide ballot.
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