BILL TO CUT AUTO RATES FAILS IN CALIF.

BILL TO CUT AUTO RATES FAILS IN CALIF.

A bill to cut automobile insurance rates up to 20 percent for good drivers fell one vote short Thursday in the Assembly Finance and Insurance Committee.

But the committee agreed to let the author, committee Chairman Patrick Johnston, D-Stockton, seek a second vote on the bill next Tuesday.His proposal, AB3921, received a 10-4 vote, but needed 11 yes votes in the 21-member committee.

The bill would cut all automobile insurance rates 10 percent effective Jan. 1, 1989. It would also require an additional 10 percent cut for good drivers, and would allow drivers who buy the minimum liability coverage for the financial responsibility law to save an additional 25 percent by cutting that coverage in half.

The bill would also require insurance companies to get prior state approval if they raise or lower rates more than 10 percent in 12 months and would end the insurers' exemption from the state antitrust law for personal insurance, retaining the exemption for commercial lines.

The bill would also allow insurers to reduce payments to injured people who are also compensated from other sources.

The bill was opposed by several insurance industry groups and the California Trial Lawyers Association.

You're not going to solve this problem with a few minor bookkeeping adjustments, said Alister McAlister, a former assemblyman who now represents the National Association of Independent Insurers.