BILL NUMBER: AB 1004	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MARCH 31, 2011

INTRODUCED BY   Assembly Member Hagman

                        FEBRUARY 18, 2011

   An act to  amend Section 105 of   add Section
1035.1 to  the Insurance Code, relating to insurance.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1004, as amended, Hagman. Insurance  : Conservation and
Liquidation Office: receivership  . 
   Existing law authorizes the Insurance Commissioner to petition the
superior court of the county in which an insurer has its principal
office for an order vesting title of all assets of that insurer in
the commissioner, in his or her official capacity, under specified
circumstances. Upon taking possession of the property and business,
the commissioner is authorized to act, except as specified, as either
conservator or liquidator. Existing law provides that there is
associated with the Department of Insurance a Conservation and
Liquidation Office with certain duties and obligations.  
   This bill would require the Conservation and Liquidation Office to
report and publish all specified claims on a quarterly basis through
a public filing with the court in which an insurer's liquidation
proceeding is pending. The bill would require the office to contact
the claimants whose claims have been allowed, as provided. The bill
would also require the receiver, the Commissioner, or the
Conservation and Liquidation Office, as applicable, upon receipt of
notice that an allowed claim has been assigned to another party, to
process that claim within 21 days.  
   Existing law defines surety insurance to include, among other
things, guaranteeing of behavior of persons and the guaranteeing of
performance of contracts other than insurance policies and other than
for payments secured by a mortgage, deed of trust, or other
instrument constituting a lien or charge on real estate. 

   This bill would make technical, nonsubstantive changes to those
provisions. 
   Vote: majority. Appropriation: no. Fiscal committee:  no
  yes  . State-mandated local program: no.


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

   SECTION 1.    Section 1035.1 is added to the 
 Insurance Code   , to read:  
   1035.1.  (a) The Conservation and Liquidation Office shall report
and publish all claims allowed in a proceeding under this article on
a quarterly basis. The reporting and publication shall be made
through a public filing with the court in which the liquidation
proceeding is pending.
   (b) After a claim has been allowed in a proceeding under this
article, the Conservation and Liquidation Office shall contact the
claimant via a written notice of determination that shall include a
best time estimate as to when a distribution will be made on the
claim. The notice shall provide an opt-out clause to the reporting
and publication process described in subdivision (a), with
instructions for exercising that clause for those individuals or
organizations that choose not to have their allowed claims reported
and published. Any individual or organization that chooses to opt-out
of the reporting and publication may retract that decision at any
time and thereafter have his or her claim information reported and
published pursuant to subdivision (a).
   (c) Upon receipt of notice that a claim, allowed in a proceeding
under this article, has been assigned to another party, the receiver,
the commissioner, or the Conservation and Liquidation Office, as
applicable, shall process the claim within 21 days.  
  SECTION 1.    Section 105 of the Insurance Code is
amended to read:
   105.  Surety insurance includes:
   (a) The guaranteeing of behavior of persons and the guaranteeing
of performance of contracts, includingexecuting or guaranteeing bonds
and undertakings required or permitted in all actions or proceedings
or by law allowed, other than insurance policies and other than for
payments secured by a mortgage, deed of trust, or other instrument
constituting a lien or charge on real estate.
   (b) Insurance against loss resulting from the forgery or
alteration of any instrument of any kind or character or of any
signature thereon. Nothing in this section shall be deemed to limit
any of the powers of title insurers.
   (c) Any of the following insurance when included as a part of
contract containing any guarantee of behavior or performance or in a
contract indemnifying any bank, banker, broker, financial, or moneyed
corporation or association, any state, political subdivision,
public, or municipal corporation, or any officer of any state,
political subdivision, public, or municipal corporation: Insurance
indemnifying the insured named therein against loss or destruction
from any cause of any evidences of debt of any kind or character,
evidences of ownership of any kind or character, deeds, mortgages,
warehouse receipts, bills of lading, certificates of stock, bonds,
notes, drafts, checks, instruments of similar character, stamps,
documents, money, precious metals of any kind or character, refined
or unrefined, and articles made therefrom, jewelry, watches,
necklaces, bracelets, gems, and precious and semiprecious stones, and
also against loss or damage, except by fire, to the insured's
premises, furnishings, fixtures, equipment, safes, and vaults therein
caused by burglary, robbery, holdup, theft, or larceny or an attempt
thereat. Insurance indemnifying against loss of any property as
specified herein shall not indemnify against loss of any property
occurring while in the mail or in the exclusive custody or possession
of a common carrier for the purpose of transportation, except for
the purpose of transportation by an armored motor vehicle.
   (d) Insurance may not be written as surety insurance if it falls
within the definition of financial guaranty insurance as set forth in
Section 12100.