From the Central Valley Business Times:
The California Third District Court of Appeal has refused to stop the implementation of Proposition 103 - the auto insurance reform measure approved by California voters in 1988.
“Once again the courts have ruled that insurers must comply with the will of voters who decided in 1988 that how safely you drive is more important than where you live in the pricing of auto insurance,” says Insurance Commissioner John Garamendi.
With a disclaimer that I’m not a lawyer, as nonsensical as doing away with territorial rating may seem to those of us in the industry, I don’t think that Prop 103, or the new more restrictive interpretation thereof, is necessarily illegal.
Presumably, while the big insurers and trade associations move ahead with exhausting the legal challenges, they’re also working behind the scenes to figure out how to capitalize on the market disruption, and perhaps restructure their programs to account for the loss of the ability to territorial-rate business.
I also have to believe that California personal auto writers might be over-represented among applicants for federal insurance charters if/when they ever come to be.