Insurance Rates

It's the peak of what is now a year-round fire season. And throughout Southern California, homeowners in blaze-prone regions are having a hard time finding fire insurance. Tens of thousands of homes are in the region's brushy canyons, with still more under construction.

As if plummeting real estate values weren't enough, insurance rates are heading up for many California homeowners. State Insurance Commissioner Steve Poizner late last month quietly approved rate-increase requests from two of the state's three largest homeowner insurance companies. No. 1 State Farm Mutual got the go-ahead for a 6.9% increase, its first in five years, while rates at third-place Farmers Group Inc. will rise 4.1%. A similar request for a 6.9% increase from No. 2 Allstate Corp.

Siding with consumer groups and state regulators, a Sacramento judge threw out a lawsuit that challenged state rules requiring require auto insurers to base their rates primarily on drivers' records instead of where they live. Superior Court Judge Loren McMaster granted a summary judgment, ruling that regulations adopted last year by then-California Insurance Commissioner John Garamendi were consistent with Proposition 103, the rate regulation initiative adopted by state voters in 1988.

Allstate said Thursday that it would stop selling new home insurance policies in California and would continue to seek a 12% rate increase for its 900,000 existing customers. The state's third-biggest home insurer announced the cutoff Thursday, saying it needs to better manage the risk of potential losses related to wildfires and fires caused by earthquakes that might sweep the Golden State.

California Insurance Commissioner Steve Poizner recommended Tuesday that insurers slash the rates they charge businesses for workers' compensation coverage by 14.2%, topping the 8% cut proposed by the largest insurer. Poizner also warned insurance companies that he would send in auditors to make sure they don't delay or deny needed medical care for injured workers, citing complaints from advocates for injured workers.

A consumer group accused Allstate Corp. of excessively raising home and auto insurance rates and using questionable practices to settle claims. The Consumer Federation of America said that in the aftermath of Hurricane Katrina, the company's policies had harmful effects on lower-income and minority policyholders. Allstate spokesman Mike Siemienas said the Consumer Federation's report contained "many inaccuracies."

Blue Cross of California's latest antidote to rising healthcare costs isn't going down very well with physicians. The state's largest for-profit health plan is set to roll back its payments for about half the services and procedures provided by physicians next month. And many of the 53,408 physicians in Blue Cross' preferred provider organization (PPO) networks say that's a prescription for disaster. Doctors say the health plan imposed the new rates unilaterally.

The Gecko's got good news for California drivers, at least for those with Geico auto insurance. The company, known for its smooth-talking reptile TV pitchman, and California Insurance Commissioner Steve Poizner are expected to announce today an almost 11% average rate reduction for all 436,000 Geico General Insurance Co. customers, about one-fourth of them in Southern California.

The cost of employer-sponsored health insurance continues to outstrip inflation and wages, rising 6.1% this year, according to a closely watched annual report. And workers are bearing more of the burden. The rate of increase is slower than in previous years, but since 2000, the share paid by the average U.S. worker has doubled.

The real estate title industry has taken a lot of flak lately for practices that state regulators and consumer advocates claim drive up the costs consumers pay for title insurance. On Tuesday, the industry sought to counter some of the criticism by unveiling a website -- www.clta.titlewizard.com -- that, for the first time, allows consumers to see what the major title insurers charge for their policies.