INSURANCE : State Urged to Block Pacific Mutual Plan

The Consumers Union urged the state Insurance Department on Friday to block Pacific Mutual Insurance Corp.’s plan to convert to a new corporate structure that would allow the public to buy a stake in the Newport Beach company. The public interest organization asserted that the plan is unfair to policyholders, who now own 100% of the company but would see their holdings fall to 51% as stock is sold to the public. Major concerns about the sharing of profits and regulatory oversight need to be resolved before the plan is approved, the group said. However, the company asserted that the plan is fair and equitable and that policyholders haven’t lost any interest in their capital. The Insurance Department has scheduled a public hearing for Tuesday at the downtown Los Angeles offices.