Insurance Rate Public Justification & Accountability Act

The Insurance Rate Public Justification and Accountability Act would:

  • Give the insurance commissioner the authority to reject excessive rate increases for individual and small group health insurance.
  • Require health insurance companies to publicly disclose and justify, under penalty of perjury, proposed rate changes before they take effect.
  • Make every document filed by an insurance company to justify a rate increase a public record.
  • Allow Californians to challenge unjustified premium rate increases.

Why Californians need public justification of health insurance rates
Today, there is no transparency in how health insurance companies set prices and premium rates. California’s health insurance companies set premiums in secrecy, handpick the people who check their math, and then expect consumers to trust that rates have been set fairly.

If a rate filing is excessive or unjustified, no one has the power to require insurance companies to undergo a public review. More importantly, no one – not even the state’s insurance commissioner – can reject excessive or unjustified rate increases. The proposed ballot measure would create a public review process and would give the insurance commissioner the authority to reject excessive or unjustified rate increases.

Why now?

  • Health insurance premiums for California families rose approximately 150% since 2002, more than 5 times the rate of inflation.
  • Only 4 insurance companies control 71% of the California health insurance market, setting premiums in secret and behind closed doors.
  • 35 other states, but not California, already require health insurance companies to get approval for rate increases before they take effect.
  • U.S. Senator Dianne Feinstein – the initiative’s Chief Spokesperson – deemed the authority to reject excessive rate increases a “missing piece of federal health care reform.” In 2014, under the Affordable Care Act (ACA), Americans will be required by law to purchase health insurance. We need public justification now to save California’s consumers millions of dollars in health insurance premiums.

Will it work in California?
Yes. The Insurance Rate Public Justification and Accountability Act is based on existing California law.
In 1988, voters approved an insurance reform law called Proposition 103 at the ballot. Proposition 103 requires auto, homeowners and other business insurance companies to open their books and publicly justify rate increases. This Act simply applies these same rules to health insurance companies.

How much have Californians saved because of Proposition 103?
Simply put, Proposition 103 has saved California’s consumers a lot of money. In 2008, the Consumer Federation of America reported that California drivers saved $62 billion on their auto insurance due to Proposition 103. In California, we have also seen auto insurance rates go up just 3.8% since 1988, while they have increased 42.9% nationally. Today, California is still home to a healthy auto insurance industry, with reports finding that it is the fourth most competitive state in the nation.

How can I help?
The initiative will be on the November 2014 Ballot. Show your support today by signing up to volunteer! You will be kept up to date with happenings and news about the initiative and will be contacted when volunteer efforts get underway.
To sign up and for more information, go to or contact

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