SANTA MONICA, Nov. 2 /PRNewswire-USNewswire/ — The following is being issued by the Foundation for Taxpayer and Consumer Rights:
WHAT: News conference/ Dept. of Insurance hearing into Allstate auto ratesWHO:Pamela Pressley, litigation director, Foundation for Taxpayer andConsumer RightsDan Zohar, FTCR outside counsel, Zohar Law Firm, P.C., Los Angeles, CATodd Foreman, staff attorney, FTCRWHEN: Monday, November 5 9:00 AMWHERE: 45 Fremont St., interior courtyard (near train)San Francisco 94105
In a Department of Insurance hearing beginning Monday, consumer advocates will argue that drivers with Allstate insurance policies deserve an 18.8% rate cut — an average of $150 per car — under new rules that limit excessive profits by the industry. Allstate Insurance Co. seeks five separate exemptions to the regulatory formula that determines auto insurance rates, including one claiming that the company will suffer deep financial hardship if it follows the rule, despite the company’s already above-average profitability and shareholder return. FTCR has determined that Allstate is overcharging auto insurance consumers over $300 million per year.
In written testimony, Allstate issued a thinly veiled threat to regulators suggesting that a company forced to abide by rules limiting excessive profit might have fewer offices, reduce the quality of its claims processing, or even stop selling insurance in the state entirely.
The hearing will be the first under new regulations issued by the Department of Insurance last year that revised the guidelines for profitability.
Consumers won an early victory in the case this week when Allstate withdrew its request to charge consumers an additional $15.5 million in premiums based upon its claim of “higher quality” customer service. Allstate’s own internal polls showed that, since at least 2000, Allstate has consistently fallen below the industry average for customer satisfaction.
Foundation for Taxpayer and Consumer Rights
CONTACT: Doug Heller, +1-310-392-0522 ext. 309, or Carmen Balber,+1-310-392-0522 ext. 324, both of the Foundation for Taxpayer and ConsumerRights
Web Site: http://www.consumerwatchdog.org/