Proposition could change auto insurance laws but opponents say its too good to be true

BAKERSFIELD, Calif. - Proposition 33 would change the California state law on auto insurance pricing.

Prop 33 would allow insurance companies to set prices based on whether a driver had any insurance over the previous five years, but those against it say it will raise rates on a lot of drivers.

Right now, in California, if you have had auto insurance with the same company for several years you can get a discounted rate.

Prop 33 would change that.

Those in favor of it say the current law is unfair to people who want to switch insurers but don’t want to lose their discount.

"They will be able to take their discount and shop with other insurance companies for a better price," said Terry McHale of the Yes on 33 campaign.

Those against prop 33 say it would penalize new drivers since they wouldn't have any previous years of auto insurance.

Prop 33 would allow insurance companies to raise rates on people without a history of continuous insurance coverage.

"They can be charged more even if the reason you didn't have insurance in the past is you weren't driving. So new drivers will be charged more for auto insurance; as much as 40 percent more,” said Jaime Court of the Consumer Watchdog Campaign

Those in favor of prop 33 say it will lower rates because it will force insurance companies to compete for customers.

"This is a very good initiative that will allow people to get insurance at a cheaper price and will present them with more options," McHale said.

Those against it say it’s a trick paid for by one insurance billionaire.

"When was the last time an insurance company executive spent $16 million on a ballot initiative to save you money? It just doesn't happen," Court said.

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