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Somebody tell Sonny to veto this suckerSenate Bill 276 will result in increased automobile insurance premiums for Georgians and should be promptly vetoed by Governor Sonny Perdue. The legislation backed by the insurance lobby and passed by the General Assembly takes away the state insurance commissioner’s authority of prior approval of most rate increases on automobile insurance. The only exception is minimum liability required by the state. This means comprehensive, collision, uninsured motorist, medical payment and property damage coverage are subject to increases without oversight. Automobile insurance premiums skyrocketed in the 1980s much like health insurance premiums are on the rise today. The issue swept Tim Ryles into the state insurance commissioner’s office in a hotly contested Democratic primary race against incumbent Warren Evans in the 1990 election. At Ryles’ request, the General Assembly fixed the problem by giving the insurance commissioner regulatory power over rate increases amid predictions from the industry that auto insurers would leave the state in droves. This did not happen! There are more than 200 companies writing automobile policies in Georgia. Competition between the major players which include State Farm, Allstate, GEICO, Georgia Farm Bureau and others is fierce. The system is working very well. Georgians should take note of how Senate Bill 276 evolved from a harmless bill into a bonus for big business interests. It passed the Senate in 2007 for the purpose of clarifying definitions and fine-tuning the law. It lingered in the House of Representatives for a year without action. Suddenly, the insurance lobbyists and their trial lawyer buddies went into action on March 4 when a substitute bill passed the House Judiciary Non-Civil Committee. I repeat, not the House Insurance Committee, but an obscure judiciary committee dominated by attorneys. The committee substitute added language taking away the state insurance commissioner’s right to approve rate increases. This onerous substitute quickly passed the full House on March 6 by a vote of 141-3 and was immediately transmitted to the Senate where it was accepted by a vote of 43-10 within two hours. Legislation doesn’t move that fast unless a deal has been cut and somebody thinks citizens are asleep at the switch. They were right. We were asleep. After several years of attempting to go back to the old system, the insurance lobby finally succeeded by teaming with trial lawyers and key legislators in a sneak attack on the public. Following the vote, a disappointed state Insurance Commissioner John Oxendine said, “Today the trial lawyers and big insurance companies are laughing all the way to the bank at the expense of Georgia consumers. If allowed to become law, this legislation can only result in higher auto insurance premiums for Georgia drivers.” The way this legislation was handled leads us to some questions about money. A friend in the legislature once told me to “follow the money trail, dummy, and you will understand politics.” A review of campaign contribution data provided by the National Institute on Money in State Politics (NIMSP) helps us see the picture more clearly. Their website is www.followthemoney.com. The same information is available on the State Ethics Commission website. According to NIMSP, the insurance industry contributed $2,063,605 to Georgia Senate, House and Statewide candidates in the 2006 election cycle. Senate candidates received $453,128 and House candidates received $630,605 in contributions. Ralph Hudgens (R-Hull), chairman of the Senate Insurance and Labor Committee, received $55,131 from the insurance industry. State Farm gave him $4,000, and The Independent Insurance Agents of Georgia matched it with a $4,000 contribution. United Auto Insurance group and Allstate Insurance were also major donors to Hudgens. Trial lawyer Tom Knox (R-Cumming), chairman of the House Insurance Committee, and a member of the House Non-Civil Judiciary Committee received $53,825 from the insurance industry including contributions of $4,000 from the Independent Insurance Agents of Georgia, $3,100 from State Farm and $2,000 from Allstate. Lieutenant Governor Casey Cagle received $149,450 from the insurance industry in the last election cycle.. State Farm gave a whopping $10,500 to Cagle while smaller players like Safeway Insurance Company contributed $5,000. An original sponsor of the bill, Senator David Shafer (R-Duluth), vice chairman of the Senate Insurance and Labor Committee, fought for an unsuccessful amendment to kill the house substitute. He subsequently made a courageous vote against the bill despite having received $31,450 from the insurance industry during the last election cycle. This legislation is about money — campaign contributions and higher insurance premiums. Proponents of the insurance industry have contributed heavily to the campaigns of Georgia politicians. Some say they do it to buy access while others cite their interest in good government. The result is consumers getting screwed to the wall again. I wasted my time writing this column and you wasted your time reading it. Gov. Sonny Perdue received $187,586 from the insurance industry during the 2006 election cycle. This level of contribution doesn’t set the stage for a veto of the bill and will likely leave consumers waiting for the wreck to happen. I hope I am wrong. Will somebody tell Sonny to step up and veto this sucker? [Scott Bradshaw is a real estate developer, resident of Peachtree City and active in the community. He is chairman of the Governmental Affairs Committee of the Homebuilders Association of Midwest Georgia, a member of the West Village Impact Fee Advisory Committee, and a former member of the Development Authority of Peachtree City. His email is rand5474@bellsouth.net.] login to post comments | Scott Bradshaw's blog
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