Chronicle Editorial Board
May 1, 2022
The mere mention of the word “insurance” is known to induce a narcoleptic effect, even in otherwise engaged people. But the insurance industry governs the everyday life and finances of Californians in more ways than you can count — and there’s plenty that can go wrong.
This is where an insurance commissioner comes in.
Among other vital oversight tasks, the commissioner has final say in rate increases, investigates fraud and makes sure the pool of cash you pay into each month isn’t totally siphoned off or invested poorly — so that, say, in the event of a major fire or flood, funds are available to help you when you need it.
What makes for a good insurance commissioner? Financial savvy, yes. But given the incredible amounts of corporate cash orbiting this person’s universe, unblemished ethics are at the top of the list.
On this front, California’s current commissioner, Ricardo Lara, is irredeemably lacking.
Lara is running for re-election after a parade of ethics scandals. The list is too long to go through in its entirety, but here are just some of the lowlights:
After promising to forgo insurance industry campaign contributions, Lara accepted in excess of $270,000 from 56 different people with ties to the industry around the time of the last election in 2018. His office then directly intervened at least twice to overrule his own department’s administrative law judges to advantage a business with ties to campaign donors. In 2019, despite earning more than $174,000 in annual salary, he stuck taxpayers with the bill for an apartment he rented in Sacramento. He also decided to accept field-level tickets to a Beyoncé concert from a fossil fuel company.
In his endorsement interview, Lara largely portrayed these lapses as the folly of youth.
Even if we were willing to give him that pass, which we’re not, there was still his office’s decision last year to implement a policy of automatically erasing old emails — while it faced a lawsuit over withholding public records.
Despite these ethical shortcomings, Lara has somewhat inexplicably maintained the support of most of the state’s Democratic Party infrastructure. Defeating him will be a challenge.
Assembly Member Marc Levine, D-San Rafael, offers the best chance to do so. And we enthusiastically endorse his candidacy.
Levine is running on a platform of good governance — which, of course, we applaud. And his track record in the Assembly indicates his tenure would be a vast improvement over the office’s ethics status quo.
But Levine’s appeal doesn’t end there.
He has vowed to mandate more transparency regarding insurance company fossil fuel investments — by, among other things, reinstating the policies of former Commissioner Dave Jones that lead to billions in disinvestment from the coal industry. California’s insurance market is so large that forcing such sunshine in this state has the potential to spark nationwide fossil fuel divestment and increased climate transparency for consumers everywhere.
In terms of equity, Levine promises to eliminate existing insurance breaks for those who are more educated; arguing that lawyers should not be getting cheaper insurance rates than farm workers. He also promises to push legislation that guarantees homeowners who invest in home hardening and other wildfire prevention measures can’t be denied insurance. This issue could prove especially crucial in the coming years, as homeowners in fire country are increasingly seeing their policy renewals denied — often after having paid into the system for years.
Lara says he, too, will be aggressive on climate change. His office recently unveiled a report revealing that more than $530 billion of the managed assets in California’s insurance investment portfolio are invested in fossil fuels. That’s upward of 9%.
But this report came years after he abandoned similar practices by his predecessor Jones, and after activists first started begging him to publish this kind of information.
Too little, too late.
That the report finally landed just months before a tough election speaks to Lara’s questionable commitment moving forward. Levine deserves your vote.