Calif. Commissioner Appeals Northridge Earthquake Settlement Decision

January 14, 2003

Citing his responsibility to seek every legal remedy on behalf of California consumers and Northridge earthquake victims, California Insurance Commissioner John Garamendi filed to appeal court decisions upholding earthquake settlements negotiated under the Quackenbush administration.

“California consumers were betrayed by Chuck Quackenbush. The sweetheart deals he made with insurance companies to settle alleged mishandling of claims shortchanged earthquake victims,” said Commissioner Garamendi. “I owe it to the Northridge victims to ask the Court of Appeal to review the decision and set aside those agreements. To do anything less only serves to make them victims again.”

Commissioner Garamendi views the decision by Superior Court Judge Chaney to allow the settlements to stand as effectively denying the department an opportunity to review and properly address consumer complaints.

The agreements in dispute were forged by former commissioner Quackenbush who was driven from office in 2000 amid controversy over the alleged inappropriateness of the settlements and use of the funds generated by the settlements.

The Northridge earthquake was one of the largest insured loss events in U. S. history with more than $12.5 billion in total losses. Insurers named in the appeal include 21st Century, Allstate, State Farm, Farmers and Fireman’s Fund.

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