Auto Rate Controversy

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(Sacramento, CA)
Thursday, April 6, 2006

There are a lot of factors insurance companies consider when it comes to figuring your rate…but a biggie is where you live.  Too big, says Byron Tucker with the department of Insurance.  He says the new regulations would de-emphasize zip codes:

 “While they will still be in play and still be allowed to be factored into setting rates, they just won’t be able to be factored in more than your driving record, the number of miles you drive and the number of years you’ve been driving behind the wheel.”

But Democratic Assemblywoman Lois Wolk, who represents a number of smaller cities, says the changes would reduce rates in urban areas…and increase them in rural ones.

 “I don’t believe that these changes should come at the expense of increased and higher rates to rural and suburban drivers.”

Wolk and four others support legislation requiring a study on the impact of the changes – before they can be implemented.   But the Foundation for Taxpayer and Consumer Rights points out that all five lawmakers have accepted donations from the insurance industry – where they say the real opposition is coming from.