Consumer Alert: How Can Members of the Public Participate in Insurance Rate Filings?
June 5, 2024 — Transparency and public input into insurance decisions are top priorities of the Department of Insurance as we address the state’s ongoing insurance crisis.
Voter-approved Proposition 103 in 1988 authorized a process for public participation in the administrative process for reviewing insurance rates. To encourage public involvement, “intervenors” are allowed to recover costs, expenses, and attorneys’ fees from insurance companies which, under law, can be passed on to all consumer policyholders. Those representing the insurance industry or other entities are not entitled to receive compensation.
Under the transparency requirements of Prop. 103, the first step for the public to recover costs is filing a request for eligibility. In order to make a determination on whether an intervenor actually represents the interests of consumers, the Department of Insurance requires a potential intervenor to file information such as corporate records, consumer protection activities, and funding sources, among other necessary information. These requests are required every two years. As with an insurance rate filing, any member of the public can participate. Even if one doesn’t want to be an intervenor, one can participate in this transparent process. Click here to view recent notices.
Only intervenors that provide a substantial contribution to a rate decision by providing valuable technical input and do not duplicate the work of the Department’s rate regulation experts may recover their costs and expenses as well as reasonable attorneys’ fees. Compensation awarded to intervenors are paid for by insurance companies, which under law, may be passed on to all California consumer policyholders under Ins. Code § 1861.10(b), (c).
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Members of the public have the opportunity to participate in the eligibility process to ensure that their interests are being represented by the proposed intervenor, as the public will ultimately be financially impacted by any subsequent compensation awards and rate decisions. |
How to become an Intervenor?
As part of his effort to increase transparency and public participation, Commissioner Lara updated a web page with eligibility requests, past awards of intervenor compensation, and petitions to intervene. The goal is to help potential intervenors become familiar with the process and participate as intervenors. In order to determine whether an intervenor represents the interests of consumers, potential intervenors must file a request for finding of eligibility, which includes information such as corporate records, consumer protection activities, and funding sources, among other necessary information.
The Department of Insurance website provides an overview of the steps involved in filing a Request for Finding of Eligibility to Seek Compensation.
Where to find filed Requests for Eligibility?
The public may find current and past requests for eligibility on the Department of Insurance website. The Department publicly publishes these documents to allow potential intervenors to become familiar with the process and to participate as intervenors. Similar to publicly accessible information regarding insurance companies, information regarding intervenors is important to ensure that all participants in the rate application process are complying with applicable statutes and regulations.
Can you participate in the eligibility process without becoming an Intervenor?
The regulations governing the process of eligibility allow any persons or groups to participate in the process. The Department of Insurance will issue notices upon receipt of such requests to encourage public participation in addition to publishing it on its website. These requirements reflect the State Legislature’s intent that members of the public have the opportunity to participate in the eligibility process to ensure that their interests are being represented by the proposed intervenor, as the public will ultimately be financially impacted by any subsequent compensation awards and rate decisions. By law, members of the public may make any presentation or advocate any position related to pending requests for eligibility.
Any additional questions?
Please contact the Department of Insurance's Office of the Public Advisor at [Acting] Public Advisor Ed Wu [Ed.Wu@insurance.ca.gov] and Abigail Gomez [Abigail.Gomez@insurance.ca.gov], and by visiting our specific intervenor webpage.
Led by Insurance Commissioner Ricardo Lara, the California Department of Insurance is the consumer protection agency for the nation's largest insurance marketplace and safeguards all of the state’s consumers by fairly regulating the insurance industry. Under the Commissioner’s direction, the Department uses its authority to protect Californians from insurance rates that are excessive, inadequate, or unfairly discriminatory, oversee insurer solvency to pay claims, set standards for agents and broker licensing, perform market conduct reviews of insurance companies, resolve consumer complaints, and investigate and prosecute insurance fraud. Consumers are urged to call 1-800-927-4357 with any questions or contact us at www.insurance.ca.gov via webform or online chat. Non-media inquiries should be directed to the Consumer Hotline at 800-927-4357. Teletypewriter (TTY), please dial 800-482-4833.
