BILL NUMBER: AB 53	CHAPTERED
	BILL TEXT

	CHAPTER  414
	FILED WITH SECRETARY OF STATE  SEPTEMBER 21, 2012
	APPROVED BY GOVERNOR  SEPTEMBER 21, 2012
	PASSED THE SENATE  AUGUST 20, 2012
	PASSED THE ASSEMBLY  AUGUST 22, 2012
	AMENDED IN SENATE  AUGUST 13, 2012
	AMENDED IN SENATE  JULY 5, 2012
	AMENDED IN SENATE  JUNE 19, 2012
	AMENDED IN ASSEMBLY  JANUARY 10, 2012
	AMENDED IN ASSEMBLY  MAY 19, 2011
	AMENDED IN ASSEMBLY  MAY 11, 2011
	AMENDED IN ASSEMBLY  MARCH 21, 2011

INTRODUCED BY   Assembly Member Solorio
   (Coauthors: Assembly Members Davis, Furutani, Mendoza, and
Portantino)
   (Coauthor: Senator Price)

                        DECEMBER 6, 2010

   An act to add and repeal Article 10.2 (commencing with Section
927) of Chapter 1 of Part 2 of Division 1 of the Insurance Code,
relating to insurers.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 53, Solorio. Insurers: procurement contracts: minority, women,
and disabled veteran business enterprises.
   Existing law requires each admitted insurer to provide information
to the Insurance Commissioner on all of its community development
investments and community development infrastructure investments in
California.
   This bill would require that each admitted insurer with premiums
written equal to or in excess of $100,000,000 submit to the
commissioner, by July 1, 2013, a report on its minority, women, and
disabled veteran-owned business procurement efforts, as specified.
The bill would provide that the failure to file the report by July 1,
2013, subjects the admitted insurer to civil penalties to be fixed
and enforced by the commissioner, as provided.
   The bill would require, among other things, that commencing July
1, 2015, each eligible admitted insurer biennially update its
supplier diversity report and submit a new report, containing
additional elements, to the commissioner no later than July 1.
   The bill would require that, by July 31, 2013, the commissioner
establish and maintain a link on the department's Internet Web site
that provides public access to the contents of each admitted insurer'
s report on minority, women, and disabled veteran-owned business
procurement efforts.
   The bill would provide that these provisions shall remain in
effect only until January 1, 2019.


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

  SECTION 1.  Article 10.2 (commencing with Section 927) is added to
Chapter 1 of Part 2 of Division 1 of the Insurance Code, to read:

      Article 10.2.  Minority, Women, and Disabled Veteran Business
Enterprises


   927.  The Legislature finds and declares all of the following:
   (a) It is in the state's interest to encourage competitive
business opportunities for all of its people. Insurers are uniquely
positioned to build relationships within the communities they serve
through the development, inclusion, and utilization of certified
minority, women, and disabled veteran-owned business enterprises
whenever possible. National companies are able to leverage buying
power to save costs to the benefit of policyholders.
   (b) By providing that each major insurer submit to the Insurance
Commissioner a report explaining the insurer's supplier diversity
statement and expressing its goals regarding certified minority,
women, and disabled veteran-owned business enterprises, and the
commissioner placing that information on the department's Internet
Web site, that online resource will help facilitate these supplier
relationships.
   927.1.  For the purposes of this article, the following
definitions apply:
   (a) "Control" means to exercise the power to make policy
decisions.
   (b) "Disabled veteran business enterprise" has the same meaning as
defined in subparagraph (A) of paragraph (7) of subdivision (b) of
Section 999 of the Military and Veterans Code, or any successor
provision. Disabled veteran business enterprise certification
eligibility requirements shall be consistent with those imposed by
the Department of General Services, and this section applies only to
those disabled veteran business enterprises certified by the
Department of General Services.
   (c) "Minority business enterprise" means a business enterprise,
physically located in the United States or its trust territories,
that is at least 51 percent owned by a minority group or groups, or,
in the case of any publicly owned business, at least 51 percent of
the stock of which is owned by one or more minority groups, and whose
management and daily business operations are controlled by one or
more of those individuals. "Minority" includes African Americans,
Hispanic Americans, Native Americans, and Asian Pacific Americans who
provide proof of United States citizenship or legal resident alien
status.
   (d) "Operate" means to be actively involved in the day-to-day
management of the enterprise and not to be merely officers or
directors.
   (e) "Women business enterprise" means a business enterprise
physically located in the United States or its trust territories,
that is at least 51 percent owned by a woman or women, or, in the
case of any publicly owned business at least 51 percent of the stock
of which is owned by one or more women, and whose management and
daily business operations are controlled by one or more of those
individuals, who provide proof of United States citizenship or legal
resident alien status.
   927.2.  (a) (1) By July 1, 2013, each admitted insurer, with
California premiums written of one hundred million dollars
($100,000,000) or more, shall submit a report to the commissioner on
its minority, women, and disabled veteran-owned business procurement
efforts during the reporting period.
   (2) The report shall include all of the following:
   (A) The insurer's supplier diversity policy statement.
   (B) The insurer's outreach and communications to minority, women,
and disabled veteran business enterprises, including:
   (i) How the insurer encourages and seeks out minority, women, and
disabled veteran owned business enterprises to become potential
suppliers.
   (ii) How the insurer encourages its employees involved in
procurement to seek out minority, women, and disabled veteran-owned
business enterprises to become potential suppliers.
   (iii) How the insurer conducts outreach and communication to
minority, women, and disabled veteran business enterprises.
   (iv) How the insurer supports organizations that promote or
certify minority, women, and disabled veteran-owned business
enterprises.
   (v) Information regarding appropriate contacts at the insurer for
interested business enterprises.
   (C) The report shall include information about which procurements
are made from minority, women, and disabled veteran business
enterprises with at least a majority of the enterprise's workforce in
California, with each category aggregated separately, to the extent
that information is readily accessible. An insurer may also include
other relevant information in the report.
   (3) An insurer that does not enter into contracts to procure goods
or services in California satisfies the requirements of paragraph
(2) by filing a statement with the commissioner attesting that it
does not enter into procurement contracts in California.
   (b) Nothing in this section shall be construed to require quotas,
set-asides, or preferences in an admitted insurer's procurement of
goods or services, nor does this section apply to insurer producer or
licensee contracts. Admitted insurers retain the authority to use
business judgment to select the supplier for a particular contract.
   (c) Nothing in this section shall preclude an admitted insurer
that is a member of an insurance holding company system, as defined
in Article 4.7 (commencing with Section 1215) of Chapter 2, from
complying with paragraphs (1) and (2) of subdivision (a) through a
single filing on behalf of the entire group of affiliated companies.
   (d) Failure to file the report required by subdivision (a), by
July 1, 2013, shall subject the admitted insurer to a civil penalty
to be fixed by the commissioner, not to exceed five thousand dollars
($5,000), or if the act or practice was willful, a civil penalty not
to exceed ten thousand dollars ($10,000). An insurer may request, and
the commissioner may grant, a 30-day extension to file the report if
needed due to unintended or unforeseen delays. If the insurer has
failed to file the report within 30 days of a written notice by the
commissioner that the insurer has failed to file the report, the
commissioner may find that the failure to file the report was willful
and increase the civil penalty to an amount not to exceed ten
thousand dollars ($10,000). The penalty imposed by this section shall
be enforced by the commissioner and is appealable by means of any
remedy provided by Section 12940, or by Chapter 5 (commencing with
Section 11500) of Part 1 of Division 3 of Title 2 of the Government
Code. This subdivision is the sole means for enforcement of this
section.
   (e) Commencing July 1, 2015, each admitted insurer specified in
subdivision (a) shall biennially update its supplier diversity report
and submit the new report to the commissioner no later than July 1.
   (f) By July 31, 2013, the commissioner shall establish and
maintain a link on the department's Internet Web site that provides
public access to the contents of each admitted insurer's report on
minority, women, and disabled veteran-owned business procurement
efforts. The commissioner shall include a statement on the department'
s Internet Web site that the information contained in the insurer's
report on minority, women, and disabled veteran-owned businesses is
provided for informational purposes only.
   927.3.  This article shall remain in effect only until January 1,
2019, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2019, deletes or extends
that date.