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California and the West

2 Bills to Help Holocaust Victims With Insurance Issues Are Signed

September 30, 1998|HENRY WEINSTEIN | TIMES LEGAL AFFAIRS WRITER

Hours before the start of Yom Kippur, the holiest day on the Jewish calendar, Gov. Pete Wilson signed two bills designed to aid victims of the Holocaust but vetoed a third.

At a ceremony in Sacramento, where he was joined by Jewish leaders, Wilson signed a measure by state Sen. Tom Hayden (D-Los Angeles) that appropriates $4 million to the California Insurance Department to help Holocaust survivors collect on World War II-era claims that some insurers have been unwilling to pay.

The funding will enable the department to send investigators to Europe to comb the files of several European insurers that have resisted honoring such claims and have been sued in federal class-action cases.

The new law (SB 1530) also will make it easier for state regulators to suspend the licenses of insurance companies that fail to honor valid claims lodged by Holocaust survivors and the heirs of Jews murdered in World War II-era genocide. There are about 20,000 such people in California.

Wilson also signed SB 1397, a measure by state Sen. Jim Brulte (R-Rancho Cucamonga) that allows a gross income tax exemption for amounts received by Holocaust survivors or the heirs of Holocaust victims as a result of a settlement of claims for any "recovered asset," such as a bank account, insurance proceeds or art.

The bill also exempts settlement payments from being counted against public assistance benefits. There are 3,000 Holocaust survivors in Los Angeles who live below the poverty line, said a spokesman for state Treasurer Matt Fong, who lobbied for that bill.

The governor said he hoped that the new laws will "help right at least some small measure of the tragic evil of the Holocaust. Of course, nothing can atone for the magnitude and depravity of the Holocaust," in which millions of people lost their lives, families were ripped apart and cities razed, he said.

Wilson vetoed AB 1715, a measure by Assemblyman Wally Knox (D-Los Angeles) that would have compelled insurance companies to reveal the names of policyholders who were likely Holocaust victims.

The bill--passed with bipartisan support like the other measures but heavily opposed by insurance lobbyists--would have required certain insurers to reveal within six months the names of all European policyholders from 1920 to 1945 or lose their licenses to operate in California. Additionally, insurers would have been required to provide a comparison of the names of holders and beneficiaries of the policies and the names of the victims of the Holocaust--the latter information coming from the Yad Vashem Holocaust memorial in Jerusalem.

In Wilson's veto message, he said Hayden's bill "is a better solution to bring prompt payment to those who have been denied for far too long." He added, "Whereas AB 1715 requires reliance upon whatever records remain in the hands of insurers, SB 1530 creates an on-site team of investigators to examine not only the insurers' records but any other evidence that Holocaust victims were issued policies that remain unpaid."

Knox issued an angry response, saying that the governor's veto will enable the insurance companies to keep money stolen from Holocaust victims and their descendants. "One thing alone enables them to get away with it--that they know, and the world does not, the names of the policyholders," Knox said. "Disclosure of those names is the key to ending their grand theft. California had a chance to right this injustice before the century ends. But with the stroke of a pen, the governor shattered that hope."

In the veto message, Wilson said the comparison of lists envisioned by Knox's bill "would seem intended to set up a class action that may be fraught with problems." Knox said he is outraged by that explanation.

"If the governor vetoed the bill to prevent people from suing to vindicate 50 years of fraud, then the governor and I strongly disagree. That's an astonishing admission," Knox said.

For his part, Hayden said he was pleased that the governor had signed his bill but disturbed about the veto of the Knox legislation, which he co-sponsored.

"My bill is the toughest legislation in the country on pressuring insurance companies to honor their claims to Holocaust victims," Hayden said. "But we still need the registry Knox's bill would have created."

State Insurance Commissioner Chuck Quackenbush, who has taken an active role in the Holocaust insurance issue for nearly a year, said the Hayden bill "will strengthen my department's already significant outreach efforts, while also emphasizing my department's authority and intention to crack down on insurance companies and their affiliates, who continue the unconscionable practice of foot dragging in honoring legitimate Holocaust-era insurance claims."

Rabbi Abraham Cooper, assistant dean of the Simon Wiesenthal Center, said the enactment of the two bills represents to the survivors "a statement of solidarity from the people of California."

In August, Assicurazioni Generali, one of the insurers being sued in a national class-action case, told a federal judge in New York that it had reached a tentative agreement with plaintiffs to settle for $100 million. But the deal has not been finalized and still might collapse, according to plaintiffs' attorneys.

Also in August, several large Jewish organizations and the National Assn. of Insurance Commissioners announced that they had reached a memorandum of understanding to create a 13-member international commission to resolve Holocaust insurance issues within two years.

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