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RESOLUTION NO. 4813
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
ARCADIA URGING THE CALIFORNIA STATE DEPARTMENT OF
INSURANCE TO MAINTAIN AN EQUITABLE SYSTEM OF ALLOC-
ATING INSURANCE LOSS COSTS ON THE BASIS OF THE
GEOGRAPHICAL AREA TO WHICH SUCH COSTS ARE PROPERLY
CHARGED
WHEREAS, California law currently provides that automobile in-
surers may use a system of territorial rating in allocating costs
between insureds in various geographic areas of the state; and
WHEREAS, the California Legislature has refused repeated attempts
by legislators representing higher-rated territories to prohibit the
use of such a system, which would result in a statewide insurance
rate; and
WHEREAS, a statewide average insurance rate would not reduce
the overall cost of insurance to the public, but would merely re-
allocate existing and future costs between insureds in various parts
of the state; and
WHEREAS, a statewide average rate would increase insurance pre-
miums for approximately two-thirds of California's motorists, while
reducing rates for the one-third of motorists living in higher-rated
territories; and
WHEREAS, elimination of territorial rating would be unfair to
the residents of the City of Arcadia because they would be required
to subsidize motorists in areas which have higher loss costs; and
WHEREAS the Department of Insurance has scheduled hearings on
territorial rating to receive input from the public and their el-
ected representatives preparatory to reporting thereon to the
Legislature pursuant to Assembly Concurrent Resolution 100 of the
1977-78 Regular Session; and
WHEREAS, information made available by automobile insurers
indicates that the elimination of territories and adoption of a
statewide average rate would increase average rates for a typical
insured resident of the City of Arcadia by 32%.
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NOW THEREFORE, BE IT RESOLVED:
Section 1. That the City of Arcadia, on behalf of its residents,
urges the Department of Insurance to maintain an equitable system of
allocating loss costs on the basis of the geographical area to which
such costs are properly charged: and
Section 2. That copies of this resolution be provided to the
Commissioner of Insurance for inclusion in the hearing record and to
Assemblyman Mountjoy and Senator Richardson.
Section 3. That the Clerk of the Council shall certify to the
adoption of this resolution.
I HEREBY CERTIFY that the foregoing Resolution was adopted at
a regular meeting of the City Council of the City of Arcadia held
on the 2Bth day of February ,1979, by the affirmative vote of
at least three Councilmen, to wit:
AYES: Councilmen Margett, Pellegrino, Saelid and Parry
NOES: None
ABSENT:
SIGNED AND APPROVED this 2Bth
day of February
, 1979.
ATTEST:
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