Saturday, 30 September 2006 10:00

8 insurance companies file for $20 million in rate reduction

Hundreds of thousands of San Diego drivers will see their auto insurance premiums drop pending approval of the latest insurer filings with the California Department of Insurance (DOI). 

Filings from eight insurers representing 577,291 motorists show that drivers stand to save roughly $50 annually on their savings if the filings are approved by the DOI. They reflect a continuing trend of falling rates since Insurance Com- missioner John Garamendi implemented his Good Driver Reforms, which make how safely you drive count more than where you live in the pricing of auto insurance.

"Rates are coming down across this state and right here in San Diego," said Garamendi. "I commend these insurers for beginning the process of lowering rates, and I urge others to move quickly to ensure that consumers only pay the appropriate amount for their insurance."

The eight insurers are State Farm, Auto Club of Southern California, AAA of Northern California, Infinity Insurance, Wawanesa, Progressive, GEICO, and USAA. Together, premium savings in San Diego will total more than $28.5 million dollars.

In August a court ruling dismissed the industry's latest challenge to the Good Driver Reforms, which have finally realized the promise of Proposition 103, approved by voters in 1988. That proposition required that insurers consider the three mandatory factors of driving record, miles driven, and driving experience above any other factor when determining rates.

However, regulations written by former Commissioner Chuck Quackenbush allowed insurers to give other factors more weight, primarily ZIP Codes. This resulted in an unfair system in which a driver who simply moved across the street, but into another ZIP Code, could be forced to pay additional charges in excess of $1,000 or more annually for insurance.

Insurers will be given two years to fully comply with the new standards, though they must show significant progress towards meeting the goal during the first year after implementation of the regulations.