Commissioner promises report on higher city auto insurance rate

December 14, 1990|By Rafael Alvarez

A report ordered nearly a year ago to determine whether Baltimore automobile owners are being illegally charged higher insurance rates than those in the rest of the state will be released by the end of the month, the state insurance commissioner said yesterday.

Commissioner John A. Donaho added that he is attaching an order to insurance companies with the report but would not disclose what the order would say.

Mr. Donaho's statements came several hours after state Sen. John A. Pica Jr., D-Baltimore, released a letter threatening to introduce legislation that would make the commissioner's job an elected position if a report favorable to city drivers was not released by Jan. 2.

In the letter -- distributed to the media, Gov. William Donald Schaefer and all state senators representing Baltimore -- Mr. Pica said that Mr. Donaho had promised statewide public hearings on the issue last January.

"I have yet to hear one word from the insurance commissioner's office regarding this issue," Mr. Pica said. "The people of Baltimore have waited too long for relief."

But Mr. Donaho said last night that his office held five public hearings on the issue earlier in the year -- in Baltimore, Rockville, Upper Marlboro, Salisbury and Cumberland.

Mr. Pica said he had not contacted Mr. Donaho yesterday before releasing the letter, which Mr. Donaho said he did not receive.

"I don't recall ever being invited to any of the hearings," Mr. Pica complained. "We were probably distracted by the [legislative] session. We didn't even know they were occurring."

But Mr. Donaho said, "He knew they were being held. He had to know because we told him about it during the session."

Baltimore residents pay much higher insurance premiums for the same coverage as motorists who live outside the city.

Insurance companies have defended the disparity with the argument that Baltimore drivers cost them more money because of a higher number of claims and lawsuits in the city.

Baltimore City Council President Mary Pat Clarke, who had threatened to sue the commissioner's office last year if a study was not made of the issue, said last night that Mr. Donaho has been promising her since the fall that the report would be released by November.

"I had been promised a ruling by November several times and I've told constituents that," she said.

"I want a favorable ruling," Ms. Clarke said. "I want relief for city drivers. I want the state law that says geography can not be the dominant factor in setting rates to be enforced."

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