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Insurance Commissioner Seeks New Rules For Setting Auto Rates

Sacramento, CA — State insurance regulators are moving to try to make auto insurance companies charge rates that are more in line with how well a person drives.

Insurance Commissioner John Garamendi has introduced a proposal that would require auto insurers to focus on three factors, a motorist´s driving record, years of driving experience and miles driven.

A proposition approved by voters nearly two decades ago was supposed to minimize the geographic differences in auto insurance rates by requiring companies to focus on those factors.

But even with the passage of Proposition 103 in 1988, insurance companies are still allowed to consider 16 optional factors, such as ZIP code, marital status and school grades.

Garamendi hopes to have the new rules take effect by the end of next year.