Consumer Watchdog Secures $1.4M from California's Intervenor Compensation Program

The California Department of Insurance (CDI) recently released data showcasing that Consumer Watchdog, an advocacy group based in Santa Monica, secured $1,427,280.80 from the state's intervenor compensation program in 2025. This figure accounts for nearly 97% of the program's total disbursements, highlighting a substantial increase from the $643,530.15 received in 2024. Meanwhile, the Consumer Federation of California Education Foundation was the only other entity to receive funds, collecting $47,500.

Since 2013, Consumer Watchdog has obtained over $11.2 million via this initiative, according to the American Property Casualty Insurance Association (APCIA). The organization charges more than $650 per hour for its involvement in insurance rate filings, raising questions about its practices in the industry.

This financial overview follows Consumer Watchdog’s 2024 recertification as an intervenor. The APCIA has criticized Consumer Watchdog, suggesting that its practices cause AI-driven prior authorization delays and potential disruptions in the market, impacting consumers negatively. The association also raised concerns over the transparency and accountability of Consumer Watchdog due to its lack of membership oversight.

Proposition 103 and Regulatory Impacts

The intervenor compensation program originated from Proposition 103, introduced by Harvey Rosenfield, founder of Consumer Watchdog. This unique California regulation allows consumer groups to participate in insurance rate review proceedings, receiving compensation for their efforts. However, regulatory compliance requirements are under scrutiny as stakeholders evaluate the program's efficiency.

In September, Insurance Commissioner Ricardo Lara proposed modifications to diversify the beneficiaries of the intervenor program. He emphasized these changes aim to enhance consumer protection, ensure insurance company accountability, and improve the rate determination process by focusing more on factual analyses rather than procedural delays.

A coalition of 24 industry and consumer organizations supported these changes, arguing that the program's misuse for personal gain comes at the expense of stakeholders, including homeowners, farmers, and businesses. Industry reports indicate that the intervenor process has led to significant delays in rate approvals. An actuarial analysis by Perr & Knight estimated average delays of over 100 days for homeowners insurance and 200 days for auto insurance in California.

Nicole Mahrt-Ganley, assistant vice president for public affairs at APCIA, commented on Consumer Watchdog's role, stating, "Their dominance in the regulatory process is not unexpected, given its foundational role in crafting the law." She criticized the current process for favoring delays over effective solutions, with adverse financial implications for Californian consumers. Both Consumer Watchdog and the Consumer Federation of California Education Foundation have opposed the proposed amendments to the program, indicating ongoing debate within the industry.