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Sep 16, 1998
Consumer Group Forces Hearing on Allstate's Excessive Auto Insurance Rates
Petition Calls for Rate Reduction of at Least $100 to $150 millionBased upon a petition filed by the Proposition 103 Enforcement Project, a consumer watchdog organization, California Insurance Commissioner Chuck Quackenbush has granted a hearing to require Allstate to lower its auto insurance rates at least 10% to 15%. The Project's petition provided strong evidence to the Insurance Commissioner that shows Allstate is overcharging its policyholders at least $100 to $150 million.
"Commissioner Quackenbush couldn't ignore the overwhelming evidence we provided that shows Allstate's rates are excessive," said Lillian Salinger, staff attorney for the Project.
Under Proposition 103, the 1988 voter-approved initiative, Commissioner Quackenbush is required to stop insurance companies from charging motorists excessive rates. Proposition 103 requires the Commissioner to not approve or allow to remain in effect any rate which is "excessive."
In June of this year, the Department of Insurance approved a 5.1% rate decrease for Allstate. However, the Project presented the Commissioner with compelling evidence from a well respected insurance expert to show that Allstate's rates are still 10% to 15% too high. Based upon this evidence, the Commissioner was compelled to grant the hearing on Allstate's excessive rates.
The following is just some of the overwhelming evidence which supports the Project's petition and will be presented at the hearing:
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