Does Obama support strict health insurance premium regulation like California has for its property casualty industry?
Nearly twenty-one years ago Californians revolted against mandatory auto insurance laws at the ballot by enacting the toughest property casualty premium regulation in America, Proposition 103. The law required auto insurance companies to seek permission through an elected insurance commissioner prior to raising premiums. The ballot measure also allowed members of the public to challenge unnecessary premium hikes, a so-called intervenor system similar to that in place in many public utility commissions. The Consumer Federation of American reported in 2008 that Proposition 103 had saved Californians $61.8 billion on their auto insurance alone. That doesn’t mean auto insurers aren’t prospering. California is the America’s fourth most competitive insurance market, while completely unregulated Illinois, home of Allstate, ranks 44th. Fewer California drivers are thrown into high-risk pools and insurers’ average profit of 13.9% in the state from 1989 to 2005 is double the national level of 6.
