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CA Department of Insurance

Court of Appeal issues decision upholding Commissioners authority

News: 2013 Press Release

For Release: May 2, 2013
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Court of Appeal issues decision upholding Commissioner's authority

SACRAMENTO- On Friday, April 26, 2013, the California Court of Appeal upheld a Los Angeles Superior Court ruling that dismissed Mercury Insurance Company's lawsuit challenging the insurance commissioner's authority.

"I am pleased that the Court of Appeal recognized that Mercury's lawsuit lacked merit and must be dismissed," said Commissioner Jones. "The Court of Appeal clearly affirmed the insurance commissioner's exclusive authority to adjudicate disputes between the Department of Insurance and insurers in an administrative forum and that insurance companies such as Mercury must wait until I render a final decision before seeking judicial intervention."

Mercury's lawsuit sought to undermine the insurance commissioner's authority in administrative hearing decisions by asking the Superior Court to intercede in this case before the commissioner could render a final decision. Instead, the Court of Appeal affirmed the insurance commissioner's exclusive authority to fully adjudicate issues presented in an administrative forum before an insurance company can contest the commissioner's decision in a Superior Court. Mercury's attempt to prevent the Department of Insurance from presenting evidence in an administrative proceeding regarding allegations that Mercury charged improper fees and rates to policyholders was rejected by the Court of Appeal.

"This appellate court ruling supports the consumer protections and authority of the insurance commissioner provided for under Proposition 103, and I look forward to rendering a final decision once the administrative process is completed," said Commissioner Jones.

The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $310 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $469 million in claims and premiums. Please visit the Department of Insurance website at Non-media inquiries should be directed to the Consumer Hotline at 800.927.4357. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.

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