California Proposition 103, Insurance Rates and Regulation (1988)
A report published in October 2015 by Ian Adams of R Street, however, summarized a number of studies on Proposition 103 with a wide range of conclusions regarding whether or not Proposition 103 was the cause of reduced insurance rates. The report stated the following:
|“||Since all of the studies recognize that, objectively, auto insurance rates went down after the passage of Prop 103, the thorny question they [academic studies] seek to resolve is one of cause and effect.
Presumably, if Prop 103’s regulatory requirements were the actual cause of the rate decrease, then it has been a success. At the same time, if it was not the cause of the decrease, and if instead any number of other factors lowered rates, then it has not been a success. Some maintain that non-Prop 103 factors have led to lower rates: fewer auto lawsuits; safer cars; stronger drunken driving laws; more effective antifraud measures; a demographic shift by baby boomers into the safest driving years; and limits on noneconomic damages for uninsured drivers. Others contend that only in concert with the rate review process set out by Prop 103 could those factors be responsible for premium decreases.