Lawsuit challenges California insurance rate approval process

A lawsuit was filed in the Alameda County Superior Court by a former chief administrative law judge of the California Department of Insurance. The suit alleges that the department’s approval of rate increases for homeowners and auto insurers bypassed independent judicial oversight required by state law. The judge claims she was pressured to change rulings consistent with California law and was subsequently fired.

The dispute centers on whether negotiated settlements used by the department to approve rate increases required independent judicial review under Proposition 103. If the court rules against the department, it could alter the regulatory framework for how insurance rates are set in the state.