Mercury Insurance Accused of Overcharging Thousands of Californians

Auto insurer Mercury Insurance is under fire by the state insurance commissioner for allegedly overcharging thousands of California policyholders. This is not the first time the auto insurance company has come under fire. Over recent months, consumer advocate agencies have fought the company because it supports controversial legislation that reached California’s June ballot.

Mercury Violated California Insurance Laws

Steve Poizner, commissioner for the California Department of Insurance (CDI), says that they have found proof that Mercury Insurance indeed disregarded California’s consumer protection statutes and overcharged consumers.

The commissioner alleged that the company may have violated the law in February, but after conducting what is called a “Market Conduct Exam” the CDI determined that during March 1 and May 31, 2007, the company did violate insurance code.

Mercury Insurance denies the commissioner’s claims and asserts that they did not overcharge consumers. However, the auto insurance company said that it may have changed insurance law and regulations in the eyes of the CDI; however, the company doesn’t see things that way.

Just Another Controversy for the Auto Insurer

Mercury Insurance has successfully become one of the most controversial car insurance companies in the nation thanks to these allegations and its diligent work in getting Proposition 17 on California’s June ballot. Campaign for Consumer Rights, a campaign affiliate of Consumer Watchdog, has been fighting the legislation because it could result in a significant insurance in auto insurance rates for California residents.

As for the legislation, residents will have to vote in June to determine their fate. However, the fate of the auto insurer may very well fall into the hands of the CDI.