GOP Legislators Back Insurer Ripoff

The following story from the California Progress Report blog was forwarded to us by one of our readers.

25 Republican Lawmakers Support Safeco in Insurance Overcharge Case

Doug Heller,
Executive Director,
Consumer Watchdog

In a stunning show of fealty to insurance giant Safeco, 14 Republican state Senators and 11 Assemblymembers have asked the California Supreme Court to overturn an appellate ruling that Safeco Insurance has to disclose the names of policyholders it may have cheated.

Considering that state lawmakers are supposed to be spending their time grappling with the disastrous state budget, it must be very important to these lawmakers to protect Safeco from accountability for overcharging Californians, including, no doubt, folks in their district. Who do they think are their constituents?… O’ Safeco, how can we serve you?

The Senators who signed the letter are Sen. Cogdil, Sen. Aanasted, Sen. Benoit, Sen. Ashburn, Sen. Cox and Sen. Hollingsworth, as well as Senators Denham, Dutton, Harman, Huff, Runner, Strickland, Walters and Wyland (Maldonado is the only Republican Senator not to sign). Also signing were Assemblymembers Smyth, Tran, Strickland, Silva, Fletcher, Berryhill, Garrick, Gilmore, Fuller, Anderson and Logue.

Here’s the backstory:

Last month a California Court of Appeals ruled that Safeco had to give our lawyers access to their files to identify Safeco customers who were surcharged in violation of California law. As the Los Angeles DailyJournal reported:

“In a published opinion that loosens limits on consumer class actions, an. appellate court said Safeco Insurance Co. must disclose which customers it allegedly surcharged illegally several years ago.

The rub is that the customer list, if produced, could identify hundreds – even thousands – of new plaintiffs in an on-going complaint against the Seattle-based auto insurer.”

In 2002, after investigating Safeco’s auto insurance application process, Consumer Watchdog sued the company for violating California law, which forbids insurers from surcharging or refusing to insure motorists just because they previously did not have insurance. The suit also charges that Safeco failed to disclose its practices to the Insurance Commissioner – a separate violation of the law.

I’m not at all surprised that the majority of Orange County GOP legislatiors signed on. It fits their desire to support corporate fraud over ethical behavior. The Lincoln Club would have their heads if they did anything else.