Endorsement: Patrick Wolff for state insurance commissioner

The Editorial Board, The Orange County RegisterOrange County Register

After the governor’s race, the insurance commissioner race is arguably the most important one on the statewide ballot this year. A functioning insurance market is crucial for a healthy real-estate industry, business climate and economy. Commissioners play a critical role because of their power to set rates. Yet few voters know much – or care – about this race.

That’s understandable in the past, when the market operated adequately if inefficiently. But property insurers have been fleeing – or stopping new underwriting – after years of costly wildfires. Regulatory restrictions limited their ability to set rates to reflect their risk. As insurers left, the state-created backstop, the FAIR Plan became overburdened and has approached insolvency.

The current commissioner, Ricardo Lara, is a former legislator. He made some poor decisions that exacerbated the ensuing crisis, but in his second term he created a Sustainable Insurance Strategy that sped up rate reviews, shored up the FAIR Plan and embraced other reforms that have stabilized the market. But many Californians still struggle to find affordable policies. There’s a lot of work left to be done.

We apologize for the long back story, but it’s crucial to keep it in mind as voters consider the candidates. No one has great name recognition, but four have risen to the top, all of them Democrats. There also are unknown Republican candidates, but a victory by any one of them in the primary could lead to a nightmare scenario: the election of a candidate promoting a socialistic “solution.”

There’s state Sen. Ben Allen, D-Santa Monica, former Sen. Steven Bradford, D-Gardena, former San Francisco Supervisor Jane Kim and financial analyst Patrick Wolff. Allen and Bradford are highly capable lawmakers who would build upon current reforms. They both understand the need to speed up the rate-review process and reduce the number of insureds on the FAIR Plan. Allen is more tentative in his explanations, whereas Bradford is forthright and compelling, but they both understand the market.

On to that nightmare: Although running as a Democrat, Kim had been state director of the far-left Working Families Party. She wants a publicly-run single-payer system, which would destroy California’s market. Even if she’s unable to implement these long-timeframe proposals, she would trigger a further exodus of insurers with her trial-lawyer/consumer-activist approach to insurance regulation. She is the likely front-runner because she has galvanized support from the left in a split field.

Wolff understands every aspect of insurance and insurance regulation. He focuses on the proper role of insurance regulation – i.e., making insurers accountable for paying promised claims – while boosting choice and competition to revive the market and lower rates. He’s an advocate for transparency.

And Wolff is best positioned to counter the emotional nonsense likely to come in the general election. This is an important race. Vote Patrick Wolff for insurance commissioner.