Proposition 33 would allow insurance companies
to base prices on whether a driver previously carried auto
insurance. Currently, insurance companies can only base prices on a
person's driving record.
Proponents of Prop 33 say it stimulates competition between insurance companies
and drives down cost of auto coverage by allowing drivers with
uninterrupted coverage to shop around their "continuous coverage"
discount.
Opponents say insurance companies will pay for those discounts
by raising rates on new drivers and people with lapsed
coverage.
A similar initiative narrowly failed in 2010 but this new
version makes exceptions for active-duty military and long-term
unemployed whose insurance has lapsed, which may make it more
attractive to voters.
(This Insight segment aired on October 24)
