[authors: Larry M. Golub and Samuel J. Sorich]

Last January, we reported that California Secretary of State Debra Bowen announced that the “2012 Automobile Insurance Discount Act,” an initiative that would allow auto insurers to use continuous insurance coverage with any admitted insurer as a rating factor for private passenger automobile insurance, received enough signatures to qualify for the November 6, 2012 ballot. (We earlier reported on this topic last summer, when the initiative was being circulated for signatures.) 

Yesterday, the Secretary of State announced that the initiative will be titled Proposition 33 on the ballot, joining ten other ballot initiatives. The Secretary of State’s website describes Prop 33 as follows:

"Changes current law to permit insurance companies to set prices based on whether the driver previously carried auto insurance with any insurance company. Allows insurance companies to give proportional discounts to drivers with some prior insurance coverage. Will allow insurance companies to increase cost of insurance to drivers who have not maintained continuous coverage. Treats drivers with lapse as continuously covered if lapse is due to military service or loss of employment, or if lapse is less than 90 days.”

As previously reported, a prior version of this initiative, Proposition 17, failed to gain voter approval at the June 8, 2010, statewide primary election.  It is anticipated that this current initiative will be hotly contested over the next four months by several consumer groups and supported by some agents and auto insurance companies.