The California Supreme Court this week denied a petition filed by the Consumer Attorneys of California (CAOC) to depublish a Court of Appeal decision which held that the charges which an insurance company billed to its policyholders who paid their insurance in monthly installments were not part of the insurance premium. ACIC opposed the depublication petition. Depublication would have prevented the Court of Appeal’s decision from being cited as precedent.
The Court of Appeal (Fourth Appellate District) issued its ruling in In Re Installment Fee Cases on December 13, 2012. (The case was summarized in the December 14, 2012 Weekly Report.) The court concluded that the insurance company’s installment fee was not part of the insurance premium or rate, and thus did not have to be stated on the declarations page or elsewhere in the policy and did not have to be approved by the insurance commissioner. In responding to discovery requests for information about its policyholders, the insurance company incurred more than $700,000 in costs related to sending privacy notices to its customers. The Court of Appeal held that the plaintiffs were required to reimburse the insurer for those costs. A letter submitted to the Supreme Court by ACIC and other insurance organizations urged the court to deny CAOC’s petition for depublication. The letter argued, “[T]he significance of the opinion transcends the case at hand and benefits both consumers and insurance companies by clarifying the applicable law and allowing a beneficial practice to continue. It is in the public interest that the Court of Appeal's reasoned analysis of the contract and regulatory issues presented by the plaintiffs' claims should remain as published precedent.”