BILL NUMBER: AB 1123	CHAPTERED  09/22/05

	CHAPTER  327
	FILED WITH SECRETARY OF STATE  SEPTEMBER 22, 2005
	APPROVED BY GOVERNOR  SEPTEMBER 22, 2005
	PASSED THE ASSEMBLY  AUGUST 29, 2005
	PASSED THE SENATE  AUGUST 22, 2005
	AMENDED IN SENATE  JULY 5, 2005
	AMENDED IN SENATE  JUNE 14, 2005
	AMENDED IN ASSEMBLY  APRIL 28, 2005

INTRODUCED BY   Assembly Member Wyland

                        FEBRUARY 22, 2005

   An act to add and repeal Section 678.3 to the Insurance Code,
relating to insurer liability.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1123, Wyland  Insurance: renewal: liability.
   Existing law provides that there shall be no liability on the part
of, and no cause of action of any nature shall arise against, any
insurer, agent, broker, or other specified person for any statement
made, unless shown to have been made in bad faith with malice in
fact, by any of them in specified communications involving the
cancellation of a policy, or in evidence submitted at certain
proceedings in which the cancellation is an issue.
   This bill would, until January 1, 2011, apply these protections,
in addition, to communications and evidence involving the nonrenewal
of a policy for insurers that issue professional liability insurance
policies to health care providers. For liability purposes, there
would not, however, be a required showing of malice in fact.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 678.3 is added to the Insurance Code, to read:

   678.3.  (a) There shall be no liability on the part of, and no
cause of action of any nature shall arise against, any insurer which
issues professional liability insurance policies to health care
providers or its authorized representatives, agents, or employees, or
any licensed insurance agent or broker, for any statement made,
unless shown to have been made in bad faith, by any of them in any of
the following:
   (1) A written notice of nonrenewal, or any other oral or written
communication specifying the reasons for nonrenewal of a policy
issued to a health care provider.
   (2) Any communication providing information pertaining to the
nonrenewal.
   (3) Evidence submitted at any court proceeding or informal inquiry
in which the nonrenewal is an issue.
   (b) This section shall apply only to nonrenewals for which written
notice is provided by the insurer on or after January 1, 2006.
  (c) This section shall remain in effect only until January 1, 2011,
and as of that date is repealed, unless a later enacted statute,
that is enacted before January 1, 2011, deletes or extends that date.