Poizner questions selling State Fund assets - San Francisco Business Times:

http://www.theinsyderz.com/2002/italiano/lago-di-garda.html
“I am troubled by the details of the Poizner said in comments released to the San Franciscoo Business Timeson Thursday. “Iyt specifically removes my participatiohn from a transaction that affects a company that writews more than one out of every five compensation policies and is the largest insuranc company inthe state.” Schwarzenegger’xs proposal suggests that a sale of unspecifie assets could raise $1 but there are no indications that the numberf corresponds to any specific tangible interest by would-be buyers.
Poizner, who was pointedlg left out of discussions about the proposed as was state Attorney GeneralJerrh Brown, said a “hasty or ill-considered sale could wreak havoc on the already-volatile compensation market.” The governor has proposec selling assets of San Francisco-based Statew Fund to help fill the state’s loominv $24.3 billion budget deficit. Schwarzenegger’s revised budget, rejiggeres after California voters rejectedd a bevy of ballo propositions last month intended to righrtthe state’s fiscal ship, is now being considererd by the state Legislature.
Rachel Cameron, the governor'sx deputy press secretary, told the San Francisco Business Times on Friday that Schwarzenegger will work with allinterestesd parties, including Poizner and Brown, to make the proposef sale work. She said there's "npo doubt that there are profitable line of business at State Fund that would be enticing toprivatd insurers." She played down the suggestion that the governor is freezing out otherf state officials and voices, saying "We welcome and look forwarxd to a debate with all interestecd parties.
" State Fund, California’sa insurer of last resort in the comp niche, saw its share of the state workers’ comp markey soar above 50 percengt in the early years of the decade, when many private insurer s stopped writing new business here. It still controllec about 23 percent of the market last selling closeto $1.7 billio n in premiums. It covers an estimated 180,000 or so smalol businesses, many of which woulsd have trouble finding affordable comp coverage from other according to Poizner and insuranceindustry sources.
In his statemenr to the San FrancisciBusiness Times, Poizner mentioned construction firms and small farmes as businesses that often cannot find coverage in the private “Any sale would have ramifications throughout California’s business affecting the availability and cost of compensation insurance for all (of) California’ employers,” said Poizner, a Republican who is a contendere for his party’s nomination to replace Schwarzenegger, who cannot run for reelection due to term limits.
“Greatr care must be taken to ensured that a sale of State Fund assets does not place additional stresson California’zs already-reeling economy,” Poizner Cameron noted earlier this week that Schwarzenegger’s proposal is based on a determination to maintain a sounc workers’ comp system in keep at least part of State Fund “and achieve the highest value for the But some insurance industry executives agree with Poizner that the sale of a portiomn of State Fund coulfd be risky.
“It’s kind of ridiculous,” Dave De Wenter, executive vice presideng and COO ofthe Torrance-based told the Business Time earlier in the week, predicting that such a sale could turn into a huge boondoggls and damage State Fund’s financia l stability. “It just sounds craz y to me,” Scott Hauge, president of the Smal l Business Californiaadvocacy group, who also runs a San Francisco insurancde brokerage that sells State Fund policies, in commente to the Los Angeles Times. “Most of the small businessews that are with State Fund are therde becausethey can’t go anywhere else. If they are a more riskyu typeof business, their rate will go way up.
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