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Dec. 3, 1997

Suit claims stalling on Proposition 103

TRANSPORTATION: An attorney seeking to represent the state's motorists says big insurers need to pay up.

The Associated Press

SAN DIEGO — An advocate for California motorists sued the state insurance commissioner and 10 companies, claiming they keep excess profits that should be refunded under Proposition 103.

Customers are due a total of $1.6 billion because the 1988 initiative hasn't been enforced, San Diego attorney Brian Monaghan claims.

``For nine years, the insurance companies have kept all the money that was supposed to be returned to the policyholders of California,'' Monaghan said. The suit was filed Monday in Superior Court in San Francisco.

Prop. 103 outlaws excessive profits by companies that benefit from state law requiring car insurance. Monaghan claims the defendants have taken profits as high as 35.8 percent a year.

The action seeks to represent all insured drivers in California. It names Insurance Commissioner Chuck Quackenbush and the state's top 10 auto insurers.

Quackenbush's office can't comment on the suit until it is served and reviewed by attorneys, said Brian Soublet, assistant general counsel for the Insurance Department.

Dan Dunmoyer, president of the trade association Personal Insurance Federation, said the law requires companies only to charge reasonable rates and does not limit profits. He called the suit ``frivolous and stupid.''

The bulk of the defendants are based in San Francisco. They provide 80 percent of the insurance for California's 19 million motorists. Up to 200 other companies will be named later, Monaghan said.

Prop. 103 was upheld by the state Supreme Court in 1994.

The author of Prop. 103, Harvey Rosenfield, has also challenged Quackenbush to enforce provisions of the law requiring companies to base their rates on motorists' driving records, rather than on where they live.


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