California Governor Newsom & Insurance Vetoes

California Governor Gavin Newsom was real busy last week vetoing bills involving insurance.

First up is the veto of a bill requiring new cars to have a system that starts honking the horn if the driver goes 10 mph over the speed limit. It’s a rather dumb idea that could cause noise and confusion for other drivers.

Had Newsom not vetoed the bill — and assuming the Legislature doesn’t override his veto — California would be the first state in the union to require cars, trucks and buses to have that type of system.

The idea behind the bill is to reduce traffic deaths.

Newsom said the federal government is the government body that sets vehicle safety standards, and this bill would set up a confusing set of regulations.

His second veto was to say no to a salary increase for insurance fraud investigators working at the California Department of Insurance (CDI). Newsom says this undermines the collective bargaining process and takes away the salary-setting authority of the California Department of Human Resources.

“By setting a salary for one state department's employees, in statute, the bill limits the state's ability to consider factors that impact the state or other state employee bargaining units when proposing compensation packages through collective bargaining,” Newsom said.

Plus, those agents got a 12% pay hike in 2021 and another 5% in 2023.

California Insurance Commissioner Ricardo Lara wants the raises and said insurance fraud has a negative impact on California’s economy. He also noted that organized crime is working overtime these days on complex financial schemes involving insurance.

“Stopping and preventing insurance fraud is critical to our state’s economy and community safety, and it is vital that we recruit and retain our committed, hard-working investigators charged with protecting consumers,” Lara said.

Source link: Insurance Business America — https://bit.ly/4esa12W

Source link: Associated Press — https://bit.ly/3Y6tZdU