Calif. Commissioner Race Shifts Focus to Industry Contributions

February 28, 2002

As the race for insurance commissioner heats up in California, the focus shifts on industry contributions, and which candidates are accepting them.

According to the Los Angeles Times, just two years after former Insurance Commissioner Chuck Quackenbush resigned from office in the wake of a scandal, Assemblyman Tom Calderon is being singled out as the only candidate willing to accept industry contributions, in excess of $1.5 million.

The Times stated that the same companies allegedly involved in Quackenbush’s scandal have been pouring thousands into Calderon’s campaign, through agents and political action committees.

Calderon’s purported acceptance of industry donations has turned the race into a fierce competition, with opponents John Garamendi and Tom Umberg vigorously raising funds to stay on top of media publicity.

The Times quoted Umberg as stating that the underlying theme of the race is which candidate can re-establish integrity to the Department of Insurance (CDI), something desperately needed after Quackenbush’s falling out.

It was further reported that the campaign trail has become vicious, despite the friendly advertisements selling candidates on television. Calderon was said to object to the criticism he has received due to industry contributions. Farmers Insurance contributed $180,404; 21st Century contributed $200,000; State Farm agents, $34,400; Allstate, $70,000; and Fireman’s Fund $20,200. Mercury insurance, a company not associated with the Quackenbush scandal, donated $150,000; with an additional $150,000 form Keith Parker, an investment partner of Mercury’s president.

Contributors purportedly support Calderon because of his fairness, believing he will sustain the interests of both insurance consumers and the industry, according to Farmers’ media relations manager Mary K. Flynn.

Garamendi stated that he would consistently point the finger at Calderon’s industry contributions until the end of the race.

Calderon was also said to have harsh criticism of his opponents, stating that Garamendi and Umberg have “their own expalining to do.”

The article also emphasized that the election comes at a critical point for the insurance industry. The next commissioner will immediately be thrust into a world of controversy regarding payouts as a result of the Sept. 11 attacks. There is a looming crisis in the workers’ comp industry that will need immediate attention. Insurance companies are requesting rate hikes to stay afloat of the troubled economy. In addition, the candidate will have to prove that the he is in the best interest of the consumers, restoring faith after the Quackenbush scandal crushed the CDI’s credibility.

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