Takeaways:
- Consumer advocacy group had sued regulator for denying compensation
- Advocate says proposal would limit public representation in rate increase hearings
- Commissioner and industry group say intervenor process drives up consumer costs
California insurance commissioner Ricardo Lara's new proposed rules for intervenor participation in insurance rate increase hearings are an attempt to stifle opposing views, according to a frequent participant in the intervenor process.
The new rules block participation of intervenors who disagree with Lara's rulings and approvals for rate increases, stated Carmen Balber, executive director of Consumer Watchdog.
"It's clear that the commissioner is gearing for more intervenors who agree with him," she said. "To the extent that an intervenor weighs in with comments that are supportive of the direction the department is going, I imagine they will continue to grant compensation. The reality is that it will severely curtail the ability of organizations and people to use the process. It doesn't delete it entirely from the law, but the effect is to slash any opinion contradictory to the commissioner's."
The commissioner's office did not respond to a request for comment on the consumer group's statements about the proposal.
Lara's proposal sets stricter standards for being compensated by the state for intervention work, including requiring a "substantial contribution" to proceedings, and public reporting of intervenor activity and compensation. The intervenor system was established as part of Proposition 103 in 1988, which governs how rate increases are considered.
In a press release announcing the proposal, the commissioner linked to documentation showing that Consumer Watchdog received 25 of the 26 payments made to intervenors so far in 2025. However, some of these payments are for rate increase filings from prior years going back to 2022.
"The regulations require the Department of Insurance to rule on a request for compensation within 90 days," said Balber. "Some of these were overdue by years, which is totally against the rules. The department has historically been slow, but these delays were really unprecedented."
"The draft regulations stack the deck against intervenor compensation," wrote Jamie Court, president and chairman of Consumer Watchdog, in a statement responding to Lara's proposal. "If they go into effect, the rules could prevent the public from having representation in rate cases and the billions they have saved as a result."
In his statement, Court points to savings that Consumer Watchdog got for insurance consumers as an intervenor. Since 2002, the group reports saving consumers $6.4 billion in insurance bills, including $1 billion last year. Over 22 years, the group received $14.2 million in compensation for its experts including actuaries, lawyers, geologists and economists, which works out to 25 cents for every $100 saved for consumers, according to Court.
Court also pointed out that 97% of rate increases from January 2022 to October 2023 that had no intervenor participation were granted, but for home insurance rate increase filings where Consumer Watchdog participated, just 62% were granted.
The Consumer Federation of California Education Foundation intervened in a rate increase request from Progressive. The federation is a co-plaintiff in the suit against the commissioner for intervenor compensation.
Merritt David Farren, an individual survivor of the LA wildfires in January, also challenged the
The American Property Casualty Insurance Association (APCIA) announced its support for Lara's proposal on September 19, the same day it was issued.
"We applaud Insurance Commissioner Lara for advancing much-needed reforms to the broken intervenor process. The only one of its kind in the nation, this process has contributed to the insurance crisis by delaying rate approvals, duplicating the Department's work, and ultimately driving up costs for consumers," said Denni Ritter, vice president for state government relations at APCIA, in a press release. "These reforms will hopefully bring greater transparency and accountability to the intervenor process—an essential step to restore market stability and ensure Californians can access the coverage they need."
The commissioner's proposal will be open for
