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Jul 31, 2000

CONTACT: Doug Heller - 310-392-0522 x309

Comments of FTCR on Insurance Commissioner Appointment

Statement of Harvey Rosenfield, President of the Foundation for Taxpayer and Consumer Rights and author of 1988 ballot initiative, Proposition 103, regarding the appointment of Retired Judge Harry Low as interim Insurance Commissioner. (Prop 103 made the Insurance Commissioner post an elective office rather than a gubernatorial appointment).

"The office of insurance commissioner was created by the voters twelve years ago to protect consumers against insurance abuses. Former Commissioner Quackenbush betrayed the voters and corrupted the office. The next commissioner will have to clean up the mess created by Quackenbush, reopen the investigations of the insurance companies' claims handling conduct, propose new rules to protect consumers against price gouging and low-balling in the future, as well as properly enforce Proposition 103 and other laws that Mr. Quackenbush permitted insurance companies to evade.

"Since the day Mr. Quackenbush resigned, we have said that the next commissioner must be a person of unquestioned integrity and an aggressive advocate for consumers. Judge Low is considered to be an individual of utmost integrity. However, his record is not that of an aggressive advocate for consumers, but rather as a judge and arbitrator. We simply do not know how Judge Low will perform in this new and crucial role.

"Moreover, we are concerned about Mr. Low's work as an arbitrator. The records of arbitration proceedings, in which insurance companies and other corporations pay judges to privately adjudicate disputes outside of the public court system, are kept secret.

"Prior to confirmation hearings by the Legislature, Judge Low must disclose his record in the arbitration hearings over which he presided. Because these proceedings are secret, the public has no way to gauge his willingness to stand up to insurance companies and other large corporations.

"Thus the question every California consumer and taxpayer has is, will Judge Low be willing to fight insurers with the resolve that California consumers need in the wake of Quackenbush-Northridge scandal? Judge Low must demonstrate that he has the backbone to stand up to corporations that threaten the public with abusive policies and practices. Policyholders need a champion who is not afraid to stand up to an extraordinarily powerful industry.

"If Judge Low is confirmed as a replacement for Chuck Quackenbush, we will work with him to ensure that California consumers and taxpayers are protected until the voters have the opportunity to elect a new Commissioner in November 2002."

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