BILL NUMBER: AB 879	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MARCH 23, 2009

INTRODUCED BY   Assembly Member Hernandez

                        FEBRUARY 26, 2009

    An act to amend Section 11750 of the Insurance Code,
relating to workers' compensation insurance.   An act to
add Section 3702.11 to the Labor Code, relating to workers'
compensation. 



	LEGISLATIVE COUNSEL'S DIGEST


   AB 879, as amended, Hernandez. Workers' compensation: 
pure premium rate  self-insurers: financial audits 
. 
   Existing law establishes a workers' compensation system,
administered by the Administrative Director of the Division of
Workers' Compensation, to compensate an employee for injuries
sustained in the course of his or her employment.  
   Existing law requires the administrative director to conduct
audits of insurers, self-insured employers, and 3rd-party
administrators to ensure that injured workers are promptly and
accurately receiving the full measure of compensation they are
entitled to receive.  
   This bill would require a group self-insurer to annually file with
the director an audited financial statement and an actuarial
analysis of its historical loss development, as prescribed. The bill
would require that the audited financial statement and actuarial
analysis be made available to the public, as prescribed. 

   Existing law requires the Insurance Commissioner to hold a public
hearing within 60 days of receiving an advisory pure premium rate
filing. Under existing law, the commissioner must approve,
disapprove, or modify the proposed rate within 30 days of the
conclusion of the proposed hearing. Existing law does not set a time
limit for the time between the initiation and conclusion of the
public hearing.  
   This bill would require the commissioner to initiate and conclude
a hearing and issue a final decision regarding the proposed rate
within 90 days. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


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

   SECTION 1.    Section 3702.11 is added to the 
 Labor Code   , to read:  
   3702.11.  (a) A group self-insurer shall annually file both of the
following with the director, in the form prescribed by the director:

   (1) An audited financial statement prepared by an independent,
certified public accountant.
   (2) An actuarial analysis, by program year, done of the group
self-insurer's historical claim loss development, performed by an
independent actuary who is an associate or a fellow of the Casualty
Actuary Society or a member of the American Academy of Actuaries.
   (b) The audited financial statement and actuarial analysis shall
be made available to the public, except that no individually
identifiable claimant or individual member financial information
shall be made public.  
  SECTION 1.    Section 11750 of the Insurance Code
is amended to read:
   11750.  (a) The purpose of this article is to promote the public
welfare by regulating concert of action between insurers in
collecting and tabulating rating information and other data that may
be helpful in the making of adequate pure premium rates for workers'
compensation insurance and for employers liability insurance
incidental thereto and written in connection therewith for all
admitted insurers and in submitting them to the commissioner for
approval; to authorize and regulate the existence and cooperation of
qualified rating organizations to one of which each workers'
compensation insurer shall belong; to authorize and regulate
cooperation between insurers, rating organizations and advisory
organizations in ratemaking and other related matters to the end that
the purposes of this chapter may be complied with and carried into
effect.
   (b) Notwithstanding any other provision of law, within 90 days of
receiving an advisory pure premium rate filing made pursuant to
subdivision (b) of Section 11750.3, the Insurance Commissioner shall
hold a public hearing and issue a final decision approving,
disapproving, or modifying the proposed rate.