Consumer Group Asks for Quackenbush Probe

April 4, 2000

Following allegations Sunday that California Insurance Commissioner Chuck Quackenbush was overly lenient with three insurers in exchange for contributions to an education and research foundation, a consumer group has asked the state’s attorney general to investigate the commissioner. The Foundation of Taxpayer and Consumer Rights has asked Attorney General Bill Lockyer to investigate the deal Quackenbush struck with State Farm, 21st Century Insurance and Allstate. The Los Angeles Times reported Sunday that Quackenbush ignored staff attorney’s recommendations to heavily fine the three companies after it was discovered they low-balled claims following the 1994 Northridge earthquake. Instead, the Times said, Quackenbush required State Farm, 20th Century and Allstate Corp. contribute to a research and education foundation. Part of the money contributed was spent on public service announcements featuring Quackenbush. Quackenbush said the donations to the foundation were an appropriate action, in that the research institution will study how to properly assess damage following a catastrophe. This is not the first time Quackenbush has been accused of using insurance monies to put his own face on television spots, thus furthering his own political career. Consumer advocates cried foul in the late 1990s after Prudential settled churning allegations in the state. Quackenbush was featured prominently in ads designed to inform Prudential insureds to join the settlement.

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