Billionaire Insurance Baron Tries to Buy Off California Republican Party
February 28th, 2012
Billionaire insurance baron George Joseph, Chairman of Mercury Insurance, is attempting to buy the endorsement of the California Republican State Party for his November insurance ballot measure. The insurance executive and “Forbes 400” billionaire is the party’s largest donor for the past two years. In 2010, when the Republican Party endorsed Joseph’s prior attempt to pass the same auto insurance surcharge initiative, Joseph donated $1 million to the Republican Party. He recently donated another $1 million in October 2011 to the California Republican Party.
The insurance billionaire’s ballot measure would penalize good drivers as much as $1,000/year for auto insurance. Consumer Watchdog Campaign and Consumer Federation of California were joined by Sharada Polavarapu, a San Francisco resident who relies solely on mass transit, to call on the Republican Party to oppose this ballot initiative as an attack on the middle class.
At the press conference Sharada Polavarapu stated: “I should not be penalized for using mass transit. This ballot initiative’s only purpose seems to be bleeding more money out of the middle class for the benefit of a billionaire.”
If the proposed initiative becomes law, Mrs. Polavarapu and other Californians who currently take public transit, walk or bicycle to work would face hundreds of dollars a year in insurance surcharges if they needed insurance because they got a new job or moved, and could only get to work by car.
She added: “If I were to buy car insurance right now I would be paying around $1,200/year. If this insurance initiative passes I would face at minimum a $488 increase/year.”
Mercury Insurance Chairman George Joseph contributed $1 million to the Republican State Party on October 12th 2011. In 2010, when a similar ballot measure sponsored by George Joseph’s company, Mercury Insurance, was on the ballot, the Republican Party endorsed that insurance surcharge initiative and George Joseph later gave the Party $1 million.
Richard Holober, Executive Director of the Consumer Federation of California added: “When was the last time a billionaire insurance executive spent a fortune to save you money? The California Republican Party should not endorse an initiative that hikes car insurance premiums on California families.”
Consumer Watchdog Campaign is calling on the California Republican Party to not support this billionaire insurance baron’s ballot measure. This measure would subject millions of Californians, regardless of political party, to a 40% surcharge on auto insurance or an increase as much as $1,000/year.
Consumer Watchdog Campaign and the Consumer Federation of California had one million dollars of “George Joseph Bucks” – dollar bills with the Mercury Insurance Chairman’s face on them, to highlight his one million dollar donation to the Republican Party.
Mercury Insurance Chairman George Joseph, the 375th richest man in America, is personally funding this ballot measure. He has contributed over $8.2 million to the ballot measure or 99.4% of the total donations received by the initiative’s committee, according to the California Secretary of State’s website.
The initiative would increase premiums by as much as 40% or more for millions of Californians who need insurance including graduating students entering the workforce, Californians who previously used mass-transit, and the long-term unemployed. Californians who had chosen not to drive for a time and did not need insurance would be surcharged when a new job, move or some other circumstance requires them to buy insurance again. This unfair penalty would punish drivers with premium surcharges that could reach $1,000 a year or more just because they took a hiatus from driving their automobile.
Background on the Proposed Ballot Measure
Mercury’s initiative would change California's insurance consumer protection law, known as Proposition 103, to legalize new surcharges by Mercury and other insurance companies. Those surcharges were made illegal when voters enacted Proposition 103 in 1988 and barred insurance companies from considering a driver’s coverage history when he or she applies for insurance. Proposition 103 has saved auto insurance policyholders more than $62 billion since its enactment, according to a study by the Consumer Federation of America.
Learn more at www.stopthesurcharge.org