California Consumer Watchdog Credited For Flat Car Insurance Costs

Californians made the right decision in granting increased oversight to the state’s Consumer Watchdog in 1988.  According to new research by the Consumer Federation of America, Consumer Watchdog prevented California car insurance rates from rising over the last two decades as rates in other states have done.

In 1989, Californians spent an average $748 on car insurance, while in 2010, the average cost actually declined to $746.  On the other hand, the national cost for car insurance increased by 43 percent from 1989 to 2010, averaging $791.  In some states, that amount is significantly higher.

J. Robert Hunter, Insurance Director at the Consumer Federation, credits the Consumer Watchdog for keeping car insurance rates flat over the last two decades.  Insurance groups and economists note that the cost of car insurance rose at a rate lower than the cost of inflation, but Hunter says only California pays less for car insurance today than in the late 1980s.

“No other state has put in place the kind of strong oversight that California voters created in 1988, and no other state has seen auto insurance prices decline.”

Consumer Watchdog is headquartered in Santa Monica, which regularly advocates for taxpayer and consumer interests.  The organization also played a role in promoting the benefits of smaller, more fuel efficient vehicles as the cost of gasoline rose over the years.  Smaller vehicles generally cost less to insure than larger vehicles, which insurance experts believe contributed to California’s low car insurance rates.