Court Cases;

OLR Research Report

November 12, 1999





By: Jerome Harleston, Senior Attorney

You asked what is Proposition 213, how it affects automobile insurance rates, and who opposed its adoption.


Proposition 213, officially entitled, The Personal Responsibility Act of 1996, was an initiative measure submitted to California voters that limited the right of uninsured motorists, drunk drivers, and felons to sue and recover damages from law-abiding citizens.

In March 1998, Insurance Commissioner Quackenbush attributed a $71 million reduction in rates filed by Mercury Insurance Co. to Proposition 213. Mercury reduced its auto rates by 20% for uninsured motorist coverage and 15% for bodily injury coverage.

Proposition 213 was supported by Mothers Against Drunk Driving (MADD), the California Police Chiefs Association, California Association of Highway Patrolman, Doris Tate Crime Victims Bureau, California Peace Officers' Association, Peace Officers Research Association of California, and the Association for California Tort Reform among others. It was opposed by the Proposition 103 Enforcement Project (this proposition lead to the use of sequential analysis in setting rates) lead by Harvey Rosenfield, Consumer Action, the California Trial Lawyers Association, and United Policyholders.


The initiative included the following findings and declaration of purpose:

1. Insurance costs have skyrocketed for those Californians who have taken responsibility for their actions. Uninsured motorists, drunk drivers, and criminal felons are law breakers, and should not be rewarded for their irresponsibility and law breaking. But, under current laws, uninsured motorists and drunk drivers involved in drunk driving and other accidents are able to recover unreasonable damages from law-abiding citizens, and criminals have been able to recover damages from law-abiding citizens for injuries suffered during the commission of their crimes.

2. Californians must change the system that rewards individuals who fail to take essential personal responsibility to prevent them from seeking unreasonable damages or from suing law-abiding citizens.

3. Therefore, the People of the State of California do hereby enact this measure to restore balance in our justice system by limiting the right to sue of criminals, drunk drivers, and uninsured motorists.

Under prior law, people who suffered an injury in a car accident could sue the responsible person, business, or government in order to recover their losses. Those losses could include both economic losses (such as lost wages, medical expenses, and property damage) and noneconomic losses (such as pain and suffering).

Proposition 213 prohibits the recovery of noneconomic losses in certain accidents. With one exception, an uninsured driver or a driver subsequently convicted of driving under the influence of alcohol or drugs ("drunk drivers") at the time of an accident cannot sue the responsible party for noneconomic losses. They can be sued only for economic losses. An uninsured motorist who is injured by a drunk driver can still sue to recover noneconomic losses from the drunk driver.

The measure also prohibits a person convicted of a felony from suing to recover any losses suffered while committing the crime or fleeing from the crime scene if those losses resulted from some other person's negligence. Convicted felons can still sue to recover losses for some injuries suffered while committing or fleeing a crime (for example losses resulting from the use of "excessive force" during an arrest).

Court Challenge

Immediate implementation of Proposition 213 was delayed because the California Trial Lawyers Association challenged its constitutionality.

The California Second District Court of Appeals upheld the part of Proposition 213 which limits the recovery of pain and suffering damages (noneconomic losses) by fleeing felons, drunk drivers, and uninsured motorists. The challenged portion of the law was the provision applying to uninsured motorists (Yoshioka vs Los Angeles Superior Court).

Rate Reduction

According to Insurance Commissioner Quackenbush, Mercury Insurance Co. reduced its overall auto insurance rates 6.4% as a result of Proposition 213. Mercury customer will pay rates below 1991 levels according to the commissioner (see Attachment).

Quackenbush also claims to have approved a total of 228 auto insurance rate decreases at a savings of $771 million. He states that competition was the key.

"Auto insurance rates are down due to an increasingly competitive marketplace, the passage of Proposition 213, the crackdown on fraud and the impementation of Proposition 103 under my new class plans. As a result, insurance companies received approval for rate decreases in 1998". They are listed below:

December 9, 1998

$53 million

California State Automobile Association

November 16, 1998

183 million

State Farm

July 6, 1998

12 million


June 17, 1998

49.8 million


March 31, 1998

40 million

Auto Club of Southern California

The Rand Institute for Civil Justice in its study "The Effect of Proposition 213 on the Cost of Auto Insurance in California" said the proposition could reduce insurers' compensation costs for personal injuries by 10%.