Prop. 103 Means Higher Car Insurance Rates for Some
Dear Street Smart:
I have been a policy holder of the Automobile Club of Southern California since 1982. My premium in 1990-91 for my van and car was $1,497. The next year, it was $1,997--an increase of $500 over the year before.
My wife and I have never had a claim with them, no accidents, we park both cars in the garage and have had no violations since 1987. I talked with my AAA agent, and he said we received all discounts and blamed Proposition 103. He said Insurance Commissioner John Garamendi approved the increases.
What a rip-off for consumers. They give me $152 back as a rebate of my 1989 policy, then raise my premium $500 a year, and John Garamendi praises them for their courage and prompt compliance with his orders.
Wake up Californians, we have been ripped off again by our insurance companies.
Fares Batarseh, Anaheim
In a way, Proposition 103 was responsible for the $500 jump you saw. Proposition 103 required the Auto Club and other insurers to abandon rating schemes based primarily on where someone lives in an effort to even out premiums across the state.
Rates must now be calculated using a person’s driving record as the basis, then using the number of miles driven and the years of driving experience someone has. To a lesser degree after that, other factors such as geography can be considered.
Most insurers made this rating structure change in 1991. They also had to do so without earning more money because of a rate “freeze” that Garamendi ordered in February, 1991, according to Michael Johnson, a Garamendi spokesman.
That freeze only affected overall earnings. Individuals could still have their premiums go up or down as a result of rate restructuring. At the Auto Club, more than half have seen a decrease, according to spokesman Jeffrey Spring.
“Overall, rates are the same. Sixty percent got a decrease in their rates when plans went to being based more on personal records. In some cases, it won’t look like that to some people,” Spring said.
Now here’s the twist: despite the change from rates based on territory, Garamendi’s office found that living in litigation-happy Orange County is still the main reason your premium is so high. To a lesser degree, the new emphasis on miles driven also raised your premium a bit, Johnson said.
Wasn’t Proposition 103 supposed to prevent just this type of thing and make your driving record one of the most important things in determining your premium? Yes, but reality has yet to catch up with the intent of Proposition 103.
Presently, the insurance companies need only show that your premium is based first on the three aforementioned factors such as driving record. But after that, other factors such as territory can still carry a lot of weight.
“The effect of territory has been dampened; however, it still remains a very significant factor and a more significant factor than the authors of Proposition 103 intended,” Johnson said
To correct this, Garamendi’s office is drafting new regulations to better spell out how your insurance rate can be set. However, it is uncertain when these regulations will be approved, much less implemented, given that the insurers may go to court to fight them.
Once the regulations emerge from the legal battlefield, there’s a chance that your rates may drop, if companies are given specific instructions on how to handle territory. Until then, Johnson and Spring agree, you should see no major increases, since the overall rate freeze remains in effect.
In fairness to the Auto Club, its customers are not the only ones to see increases, and the not-for-profit company is the only major insurer to meet the Proposition 103 provision to roll back 1989 insurance rates to 20% below 1987 levels. This was done by issuing a rebate to policy holders--that $152 that you received. The insurance commissioner’s office is still trying to get other insurers to do the same.
Dear Street Smart:
The street signals at Broadway and East Street in Anaheim have remained the same ever since they were changed to accommodate traffic when a nearby train underpass was being built about four years ago. Broadway signals allow one direction to go straight or turn left, then the other direction is given the same thing. On the other hand, East Street, with much more traffic, does not enjoy left-turn lights. Why not?
Amin David, Anaheim
There’s not enough room to add those signals on East Street without rebuilding the entire intersection--an expensive undertaking, according to John Lower, Anaheim’s traffic manager. That’s why this project, which the city agrees is needed, has not been done.
It may happen if the city is given some Measure M money from the Orange County Transportation Authority. Anaheim placed that intersection on a list of projects it has submitted to OCTA for funding. The city should find out yea or nay by June, so check back with Anaheim around that time.
Dear Street Smart:
Every morning, I see traffic bottlenecked on El Toro Road for a couple of hours because of a large number of South County drivers trying to avoid the El Toro Y. Drivers follow Aliso Creek Road to El Toro Road, then take El Toro to Laguna Canyon Road, which they follow to the San Diego Freeway. To alleviate this congestion, and even decrease the need for the San Joaquin Hills Tollway, I suggest that Aliso Creek Road be continued to Laguna Canyon Road.
I have been told by a county supervisor that the reason this is not being done is to “create a need for the transportation corridor.” It is my estimation that if this road were built, the need for the tollway would decrease significantly, and Aliso Creek Road would become a major thoroughfare for South County.
Please do what you can to pursue the continuance of Aliso Creek Road. I believe Laguna Beach would rather see a half-mile portion of the canyon cut with a road going through it than the 15-mile portion the tollway will be utilizing.
Gregory P. May, Aliso Viejo
Chris Melville of Aliso Viejo wrote in with a similar observation about El Toro Road and asks if help is in sight. The answer is a qualified yes: Help is coming, but not to that road.
Instead, the county is directing efforts at widening Moulton Parkway from Glenwood Drive to just past El Toro Road. Moulton has also been recently synchronized from Dana Point up through Irvine, and the overall intent is to make it the major thoroughfare that you want Aliso Creek to be, according to county road manager Roger Hohnbaum.
The county hopes that drivers will use an improved Moulton Parkway to avoid the El Toro Y rather than doing the El Toro Road detour. Work along Moulton should be completed by July. Eventually, Moulton is destined to become an even more efficient “super-street.”
As for Aliso Creek Road, plans to extend it are on hold because of the tollway. Hohnbaum said this is because the tollway may relieve the traffic burden in that area enough to make the Aliso Creek extension unnecessary.
Hohnbaum disagreed that extending Aliso Creek Road would be enough to make the tollway unnecessary, pointing out that the tollway is planned to serve a broader portion of South County than an extended Aliso Creek Road would serve.
As for Laguna Beach, the city doesn’t want either Aliso Creek Road extended or the tollway built, according to Municipal Services Director Terry Brandt. And the city isn’t pursuing an expansion of El Toro Road, figuring that the improvements to Moulton Parkway will be enough.
“People then wouldn’t be forced to come on to El Toro and then to Laguna Canyon Road,” Brandt said. “I’d advise motorists to take (Moulton) after all that work has been completed.”
By the way, the city is talking with Caltrans about a reversible flow along Laguna Canyon as a means of handling demand without expanding the road. At the moment, Caltrans has not viewed the idea favorably, but the city expects to begin discussions again.
