Allows auto insurance companies to base their prices in part on a driver’s history of insurance coverage.

This is an initiative statute that would allow insurance companies to offer a discount to drivers who have continuously maintained their auto insurance coverage, even if they change insurance companies, notwithstanding the ban on using the absence of prior insurance for purposes of pricing. It also allows auto insurance companies to increase the cost of insurance for those drivers without a history of continuous coverage and establishes that lapses in coverage due to nonpayment of premiums may prevent drivers from obtaining a discount. Mercury Insurance is the primary sponsor of this initiative. They have already spent more than $3 million on the campaign.

The Legislative Analyst’s Office reports there will probably not be significant fiscal effect on state insurance premium tax revenues.

Supporting Arguments:

Those in favor of this initiative argue that there’s a flaw in the current law that the benefits of having continuous coverage do not carry with consumers when changing insurance companies for better pricing. They argue that the 80 percent of good drivers who maintain coverage should not be penalized for changing insurance companies for better rates.

Supporters include Mercury Insurance, CalChamber, the California Alliance for Consumer Protection, and the California Senior Advocates League, among others.

Check out www.yesprop17.org for more info.

Opposing Arguments:

Opponents argue that this initiative will actually impose a surcharge on customers by imposing a financial penalty on those consumers who are restarting their coverage, even if those customers have perfect driving records and simply did not own a car or need insurance for a period of time.

Opponents include Consumer Watchdog, Former Insurance Commissioner John Garamendi, Consumers Union, and more.

Check out www.stopprop17.org for more info.
See the full text here (http://voterguide.sos.ca.gov/pdf/english/17-title-summ-analysis.pdf)