NJ state insurance commissionerresigns

Thursday, February 03, 2005

BY JOE DONOHUE

Star-Ledger Staff



After overseeing the most dramatic overhaul of the New Jersey auto insurance market in three decades, Holly Bakke is resigning as state banking and insurance commissioner, it was announced yesterday.



In a letter dated Feb. 1 to acting Gov. Richard Codey, Bakke said she is resigning effect March 1. She took office in March 2002 after being appointed by former Gov. James E. McGreevey.





"I appreciate that Commissioner Bakke stayed on during the transition, and I recognize the importance her family played in her decision to resign," said Codey. "Commissioner Bakke's commitment to improving insurance, banking and real estate services for New Jersey's consumers will be greatly missed."



Bakke said she was resigning to spend more time with her son, Christian.



As one of the longest serving commissioners, she said it often has been hard to strike a balance between her professional and family life. Codey mentioned the same dilemma when he opted not to run for governor earlier this week.



"That is going to change however as I spend more time with my son and again become involved in my community," she wrote. She did not mention her future work plans.



Banking and Insurance spokeswoman Jaimee Gilmartin said Bakke was unavailable for further comment yesterday. She said no decision has been made on a successor.



During her tenure, Bakke's most far-reaching accomplishment was to carry out a law enacted in 2003 that made it easier and more profitable for auto insurance companies to operate in the state. As a result, Mercury General and GEICO both have begun doing business here, several other companies are exploring the possibility and State Farm has dropped plans to leave.



Department officials contend that the resulting competition has led to $300 million in rate reductions and the hiring of 1,200 new agents. Under other reforms, 41,000 previously uninsured drivers now have coverage.



Bakke also implemented a law aimed at predatory lending, and took steps to make health insurance more affordable.



Magdalena Padilla, executive director of the Insurance Council of New Jersey, called Bakke's departure regrettable. "She's done so much for consumers, for the industry, for making New Jersey a better place to do business. That's the goal of every commissioner."



"She should be proud of the work that she's done," Padilla said.



Louis Beckerman, president of the Professional Insurance Agents of New Jersey, said Bakke has done a "great job. She walked into a situation where insurance companies didn't want to do business with the state. She recognized the problem and realized it's an issue of supply and demand, and got companies in, and now we're going to see the competition."



While Bakke insists that consumers are better off with more competition, some critics thought she made too many concessions to lure back companies. John Dyke, president of NJ Auto Agents Alliance, said she had become a "political liability during a gubernatorial election year."



"Many people view her as making a profitable auto insurance industry even more profitable. It may help availability for the short term until the profits dry up," he said, but added that he "wishes her the best."