HomeMy WebLinkAbout79-18 - Urging Equitable Allocation of Insurance Loss CostsRESOLUTION NO. 79-18
A RESOLUTION OF THE THE CITY COUNCIL OF THE CITY
OF COSTA MESA, CALIFORNIA, URGING THE DEPARTMENT
OF INSURANCE TO MAINTAIN AN EQUITABLE SYSTEM OF
ALLOCATING LOSS COSTS ON THE BASIS OF GEOGRAPHI-
CAL AREA.
WHEREAS, California law currently provides that automobile in-
surers may use a system of territorial rating in allocating costs
between insureds in various geographic areas of the State; and
WHEREAS, the California Legislature has refused repeated attempts
by legislators representing higher -rated territories to prohibit the
use of such a system, which would result in a Statewide insurance rate;
and
WHEREAS, a Statewide average insurance rate would not reduce the
overall cost of insurance to the public but would merely reallocate
existing and future costs between insureds in various parts of the
State; and
WHEREAS, a Statewide average rate would increase insurance pre-
miums for approximately two-thirds of California's motorists, while
reducing rates for the one-third of motorists living in higher -rated
territories; and
WHEREAS, elimination of territorial rating would be unfair to the
residents of Costa Mesa because they would be required to subsidize
motorists in areas which have higher loss costs; and
WHEREAS, the Department of Insurance has scheduled hearings on -�
territorial rating to receive input from the public and their elected
representatives preparatory to reporting thereon to the Legislature
pursuant to Assembly Concurrent Resolution 100 of the 1977-78 Regular
Session; and
WHEREAS, information made available by automobile insurers indi-
cates that the elimination of territories and adoption of a Statewide
average rate would increase average rates for a typical insured resi-
dent of Costa Mesa by 20 percent;
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City
of Costa Mesa, on behalf of the City's residents, urges the Department
of Insurance to maintain an equitable system of allocating loss costs
on the basis of the geographical area to which such costs are properly
charged;
BE IT FURTHER RESOLVED that copies of this Resolution be provided
to the Commissioner of Insurance for inclusion in the hearing record,
and to Assemblyman Mangers and Senator Schmitz.
PASSED AND ADOPTED this 20th day of February, 1979.
Mayor of the City Vf Costa Mesa
ATTEST:
City Clerk of t e City of Costasa
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) SS
CITY OF COSTA MESA )
A
I, EILEEN P. PHINNEY, City Clerk and ex -officio Clerk of the City
Council of the City of Costa Mesa, hereby certify that the above and
foregoing Resolution No. 79-18 was duly and regularly passed and
adopted by the said City Council at a regular meeting thereof, held on
the 20th day of February, 1979.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
Seal of the City of Costa Mesa this 21st day of February, 1979.
"Clerk/6/the
Ci y
Clerk and ex -officio
City
Council of the City
of Cosy
Mesa