Candidates for the elected post of California insurance commissioner are starting to declare themselves for the 2002 election, with several familiar names among the current contenders.
John Garamendi, former California commissioner, and Tom Calderon, chairman of the California Assembly committee on insurance, are among four Democratic candidates, a group that also includes Tom Umberg and William Winslow.
Harry Low, the current commissioner, has said he will not run for office in 2002.
Garamendi told National Underwriter he wants a second term as commissioner because “I love public policy.” When asked about critics’ comments that it would be a stepping stone to the governor’s mansion, Garamendi quipped, “I tried that once and it didnt work.”
Issues such as Executive Life qualify him for another term, Garamendi asserts. “I’m happy to run on Executive Life. If they want to raise Executive Life, I’ll run on it,” he says. Garamendi notes that 92% of policyholders got 100% of their contract values.
He addressed the issue of Exec Life’s junk bond portfolio, saying that three auctions were held and the highest value received at that time. Criticism has been directed at Garamendi, suggesting the department should have held onto the bonds and waited for the market to improve. However, he says the department did not have the staff or knowledge to manage the portfolio.
On financial privacy, Garamendi says legislation “needs to go beyond federal privacy laws.” The simplest solution, he says is an opt-in requirement in which a consumer would have to give permission before nonpublic personal financial information could be used.
Garamendi says his name recognition will help his candidacy. An independent field poll taken in June found he has a 50% recognition rate, the fourth highest of any California candidate running for 2002 office, he adds. It would take $4 million to $5 million in advertising to get that kind of name recognition, he says.
Garamendi also says that if elected, he will not take money from insurers.
Indeed, in filings with the state, in third quarter 2001, Garamendi had total contributions of $139,930 and a total of $150,824 in his campaign coffers.
State documents tell a different story for Calderon. Filings show Calderon has two campaign funds with totals of $1,083,163 and $14,787. Contributions in third quarter 2001, according to filings, totaled $474,621 and $63,900.
Insurers have been large contributors to Calderon’s effort. In his bid for commissioner, the American Insurance Association has contributed $50,000; American International Group, $25,000; Allstate Insurance Companies, $20,000; California Association of Health Underwriters Political Action Committee, $15,000; Citigroup Inc., $10,000; Farmers Insurance Group of Companies, $20,000; St. Paul Cos. and St. Paul Fire and Marine Insurance Company, $25,000; and Zenith National Insurance Corp., $25,000.
The contributions do not include monies Calderon received for his run for state assembly. State records show his state assembly reelection fund received $79,000 from life, property-casualty, and health insurers in 2001.
Valerie Martinez, a spokeswoman for Calderon, says in his assembly position Calderon will take into account the needs of all his constituents.
Michael Mattoch, Calderon’s chief counsel on the insurance committee, outlines Calderon’s positions on key insurance issues. Calderon abstained from a vote on California’s S.B. 773 financial services privacy law because he supported a proposal put forth by Gov. Gray Davis that would have allowed joint marketing agreements.
State filings show that at the end of third quarter, Umberg had received $112,924 in contributions and had $1,621,328 in cash in his campaign fund.
Umberg says the department needs to be more accessible to the public. He says that when possible, his meetings would be made available through an Internet broadcast. It is a process he dubs “commissioner cam.” He says he would also dedicate two hours a week to meeting with consumers.
Umberg says he would also prohibit contributions and gifts to department employees including himself in an effort to restore integrity.
Additionally, Umberg adds, he would make the department more efficient by reducing the product approval time from a turnaround he says can currently take anywhere from 8-18 months.
Winslow’s filing shows a contribution of $23,000 and ending cash of $19,510 in third quarter 2001.
Winslow, a lawyer with a background in workers’ compensation, says that on the issue of long-term care rates, he would focus on public awareness campaigns and ensuring that there are quality LTC providers in the market.
Reproduced from National Underwriter Life & Health/Financial Services Edition, October 22, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.