Prop 17 – All car insurance all the time

Prop 17 would change auto insurance pricing.  See the League of Women Voters – California 30-second summary here.   People who have vehicle insurance all the time will be eligible for discounts whether they remain with their current insurer or change to a new insurer (assuming the companies offer discounts, which they would).   Mercury Insurance paid the ballot signature collectors to put the measure on the ballot, and is openly supporting the measure by spending multiple millions on promotion.  Nothing wrong with that.  Prop 17 makes all the sense in the world for Mercury Insurance.

The measure would permit Mercury and every vehicle insurance company to offer lovely and deep discounts to continuously insured persons who switch companies.  Like Comcast does.  And AT&T.  With and without Prop 17, the insurance companies are permitted to raise rates for people not eligible for the lovely and deep discounts.  With Prop 17, the group of people vulnerable to the higher rates will be those who stop being insured for more than 90 days (an exception would exist for people who let their car insurance lapse due to military service). 

If Prop 17 passes and you, currently insured person, decide to jetison your vehicle and your car insurance for any number of rational reasons, lots of luck being able to obtain affordable car insurance should your life change such that you need a car (and car insurance) again.  Because you let your insurance lapse, Mercury and the other insurance companies are free to charge you a bunch. 

By contrast, if you keep your car and your car insurance without a lapse, the discounts are yours.  Makes one wonder why GM, et al. aren’t sponsoring Prop 17, too. 

Currently, lack of insurance coverage is not a factor in setting car insurance premiums.  Only a safe driving record,  the number of miles driven per year, and the number of years of driving experience may be considered.  If you are thinking that you have no intention of giving up your car and will be continuously insured, so why should you care about Prop 17, think again. 

You may be transferred somewhere that a car makes no sense.  You may have a daughter who heads off to college and doesn’t need that cute car (and car insurance) you bought her during her junior year.  You might wish at least half your neighbors would give up their cars, thus creating more on-street parking for you!  You may even believe that vehicles create pollution, and that people who can do without should — for cleaner air for all (including you). 

Prop 17 is a significant disincentive to give up that car – and that car insurance premium.  It creates a massive penalty for doing so should you, your daughter, or your neighbors need to reenter the insurance system.  No discount compensates for being forced to keep writing checks for premium payments for a car someone doesn’t need or want. 

Take it from a person who gave up her car to live in Manhattan, then moved to a city where a car was essential — and paid $6,000 (correct) per year for car insurance because she did not have continuous insurance.  This with a perfect driving record and a boring car in a decent neighborhood.  I had to pay that surcharge until I passed the three year mark of being insured again, when the “normal” annual premium was $1,500.

Prop 17 means all car insurance all the time, or more fool you.  I mean, come on. The good news is that just saying no to Prop 17 works.  If you are insured and stay insured you likely already are eligible for discounts from your company.  No on Prop 17 doesn’t change that.  All the better if you insure other things you own with the same company (as you know…if not, call your agent and ask).  

In my opinion (NOT the League’s position), No is the way to vote on Prop 17. 

The League of Women Voters did not take a position regarding Prop 17 because none of the League’s positions are on point.

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