Whatcha Talkin’ About?

Some people — Diff’rent Strokes’ Willis, perhaps (at least by Arnold Jackson’s standards) — have the gift of gab. And if you’ve been listening to the news in California, you know insurance groups and consumer advocates do, too. There’s already been a decent amount of discussion by both about the merits and drawbacks to voter initiative Proposition 17.

For those of you who haven’t heard all the rumblings, Prop. 17 will be decided on in the June 2010 primary election. The measure would change a provision in state law to allow insurers to reward drivers who have had insurance for some time to be eligible for a “persistency discount,” even if they switch carriers. Currently a driver can qualify for a persistency discount if he or she renews a personal auto policy with the same insurer or an insurer within the same group, but the driver no longer qualifies for that discount if he or she changes carriers.

Proponents say Prop. 17 will benefit consumers because it will lead to more competition as consumers shop around for better rates.

Opponents say Prop. 17 will let insurers surcharge drivers who have a lapse in their insurance, including those in the military.

The problem is, however, that ever since this initiative qualified in January to appear on the ballot, the proponents and opponents have been trying to stir up so much PR for their arguments — criticizing the main supporter and opponent of the proposition and even taking their arguments through the court system — that they’ve simultaneously muddled their messages.

In an informal poll of my friends, 100 percent had no idea how to vote on this issue, because they can’t determine whether their individual insurance rates would go up or down. Would someone who has a job assignment for six months in another state and decides he doesn’t need insurance on a car that’s in storage see an increase in his premiums once he returns to California? Would someone in the military really be surcharged while training elsewhere? The list of questions goes on and on, and so would the answers, because the answer is that insurance rates reflect each individual’s risk factors.

This is the heart of the matter about which insurance groups and consumer advocates should be talking. And this is where insurance agents can be helpful, too.

As consumers’ trusted advisors, agents and brokers absolutely should join in on the discussions about what Prop. 17 means to their customers. Because it’s one thing to talk about the issues, but it’s another thing for actual agents to talk about how these issues impact their customers on a day-to-day basis.

“Insurance consumers in commercial and personal lines absolutely rely upon their brokers and agents to provide a wide variety of services that commissions alone cannot support. If consumers did not find these services valuable, they would obtain their insurance elsewhere,” said Steve Young, senior vice president and general counsel for Insurance Brokers and Agents of the West.

So show your customers what you’re worth. Prop. 17 will be in the voters’ hands in June. Help them understand what the initiative means to them. And remember that California is already known for its wildfires. As working professionals, don’t add more fuel to the fire.

Topics California Agencies