Consumer Federation of California

Consumer Federation of California (CFC) saved over 330,000 drivers more than $15 million through challenges to insurance rate hikes in 2015.

Hartford and Safeco had both sought to boost auto insurance rates for some 332,000 California drivers by almost 7%. CFC challenges to the rate hike proposals cut the increases by 50% and 40% respectively. CFC opposed the rates under Proposition 103, the 1988 ballot measure that gives consumers and advocacy groups the right to present to the Department of Insurance a statistical analysis that shows a proposed increase is excessive.

The result: $5 million in auto policy savings for Hartford customers and $10 million for Safeco customers.

GEICO And Earlier Savings From CFC Intervenor Challenges

In August, GEICO agreed to pay $6 million to settle CFC’s complaint alleging the insurance giant violated civil rights and insurance law by targeting women and unmarried, lower-income motorists with deceptive and inflated automobile insurance rate quotes. GEICO also agreed to end deceptive and discriminatory rate quotes. It is difficult to calculate motorists’ potential savings resulting from the settlement, but CFC estimates it may reach several million dollars annually. The Insurance Code does not allow refunds to consumers who may have been overcharged, so GEICO’s payment goes to the state of California. Read more here.

Click here to see the savings from our 2014 insurance rate challenges.

Still To Come: Possible Homeowner Insurance Savings

In January, CFC and Consumer Watchdog (CW) challenged a bid by State Farm to charge its 1.7 million homeowner and renter policyholders in the state an extra $125 million. In proceedings ordered by the Department of Insurance, CFC and CW’s legal team will present expert testimony from actuaries that, under Prop 103, State Farm should actually lower those groups’ rates by almost $100 million. A decision is expected next year.

Tags: California Department of Insurance, CFC, GEICO, Insurance, Prop 103