CA Insurance Commissioner Poizner Drops Uninsured Mototirst Referendum

Insurance Commissioner Steve Poizner has dropped plans for a ballot initiative that would have permitted law-enforcement officers to confiscate the license plates of vehicles without insurance, saying he wants to seek legislative remedies to reduce the state's number of uninsured motorists.

Source: Source: BestWire Services | Published on February 28, 2008

Poizner will focus on the previously announced expansion of the California Low Cost Automobile Insurance Program by 16 counties, so that it covers the entire state said Brian Seitchik, Poizner's political director at the California Republican Party. The commissioner will also seek further unspecified steps to address the number of uninsured drivers, he said.

"Right now, he wants to work with the legislature to address this problem," Seitchik said.

Approximately 25% of the state's drivers are not in compliance with a law requiring automobile insurance, Poizner has stated.

In a Feb. 22 open letter to Poizner, the Greenlining Institute, a Berkeley-based group focusing on civil rights and economic development, said the referendum proposal would both unfairly target the working poor and endanger police officers by having them physically remove license plates on the side of the road.

"It doesn't make sense from an insurance perspective or a public safety perspective," Legal Counsel Samuel Kang said.

Poizner and state legislators should expand the lower-income insurance option by raising the income threshold and doing more to market and promote the option, Kang said.

To be eligible for the program, family income cannot exceed 250% of the federal poverty level, equal to $25,525 for a single person, $34,225 for two persons and $51,625 for a family of four. The value of an insured vehicle must not exceed $20,000. Applicants meet certain "good driver" criteria, including no more than one at-fault property damage-only accident, or one point for a moving violation in the past three years.

Samuel Sorich, president of the Association of California Insurance Companies, said California has recently improved computer systems to create a more efficient and accessible system to recognize uninsured drivers. Sorich's organization — an affiliate of the Property Casualty Insurers Association of America -- had not taken a position on the referendum.

Motorists driving without insurance can have their vehicle registrations suspended by the Department of Motor Vehicles, under a legislative package implemented January 2006 to reduce the risk of economic losses in collisions involving uninsured motorists.