INSURANCE: Bill Would Bring Back Complaint Survey
"The Consumer Complaint Survey -- a yearly tally of insurance companies' alleged missteps as reported by policyholders -- would reappear next year under a bill that is moving ahead in the legislature," the Sacramento Bee reports. The survey and review was originally published by the Department of Insurance from 1991 to 1994 under then-Commissioner John Garamendi. Publication was suspended in 1995, when current "Commissioner Chuck Quackenbush pulled the plug after insurance companies lobbied for, and got, a law that barred the survey pending a clearer definition of a 'justified complaint.'" After three years of wrangling over semantics, the government and the insurance industry developed a working definition of "justified complaint" as one that "alleges an insurance company broke the California Insurance Code, strayed from its own internal policies ... failed to respond to a policyholder," or merited remedial action. The bill to reinstate the program was introduced by state Sen. Byron Sher (D-Palo Alto). It would require the DOI to mail the survey on request, provide the information over the phone and post it on the Internet.
It's About Time
Philip Roberto of the Proposition 103 Enforcement Project, an insurance watchdog group, said, "We absolutely would like to see this complaint survey back out there again." Judith Bell of Consumers Union said, "The real issue is companies don't want their dirty laundry out there. It's a pretty straightforward need for consumers to be able to find out about complaints against insurance companies. It's an important tool." Such supporters point to a decline in complaints from 4,118 at the inception of the survey program in 1992, to 1,880 in 1994 when activity was suspended. The insurance industry was not so welcoming. "We question the usefulness of publicizing the complaints because there is always the possibility of misleading people or of the information being misconstrued," said Bill Packer of the Association of California Insurance Companies (Young, 4/10).