Proposition 33 – Pros and Cons – for Our Mtg on Monday

To help you prep for voting and for our 10/29 meeting to debate the ballot propositions, here are some details on Proposition 33.   Sorry to sound so biased.  But, Prop.33 is yet another sleazy attempt by one zillionaire – in this case, the former head of Mercury Insurance company – to abuse the initiative process to benefit his private interests.


According to the official election guide, prop.33:

Changes current law to allow insurance companies to set prices based on whether the driver previously carried auto insurance with any insurance company. Allows proportional discount for drivers with some prior coverage. Allows increased cost for drivers without history of continuous coverage.

In English, this means that auto insurers would be able to offer discounts to drivers that have been continuously insured for a long time (including by another company), and charge more to others who have had a lapse in insurance.  Under current law, if you have maintained continuous auto coverage for a long time, you can get such a discount, but only from the same company – not another.  Why not?  Because voters outlawed it via another referendum in 1988.   The Mercury Insurance honcho wants to bring that back so that Mercury can poach (or fairly compete for, if you prefer) drivers from other companies


  • Lower rates for some drivers – those who have/will maintained continuous coverage with one company.
  • Makes CA’s auto insurance market more “flexible” by allowing more precision pricing to consumers.
  • Prop.33 temporarily exempts from the higher auto insurance rates some people who have had lapses in coverage, including people who have lost their jobs and service members.
  • Supported by the CA Republican Party and some local chambers of commerce.  (More complete list here)
  • Government by zillionaire insurance executive trying to gain business for his company appeals to you!

Cons –

  • Why should insurance companies be able to charge you more just because you once lacked coverage?  Shouldn’t rates be based on driving record and risk, and shouldt insurers be able to punish people who couldn’t afford insurance for a spell?
  • In 1988 via proposition 103, Californians outlawed the practice that prop.33 wants to bring back.  It’s been working just fine.  The auto insurance companies have hardly been suffering.  Mercury put a similar measure on our ballot just a few years ago, and it went down in flames.  So, they are trying it again.  This is an abuse of the citizens’ initiative process and should be slapped down again.
  • Yes, some drivers would see lower prices if 33 passes.  But, younger and poorer divers –exactly the people we should be encouraging to get auto insurance – would pay more.
  • Prop.33 is opposed by consumer groups and by the CA Democratic Party.  (List here)

Links to Pro/Con Opinions


NEXT POST:  The important big tax and spending-related propositions: Prop. 30 and 38.


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