BILL ANALYSIS Ó AB 1425 Page 1 Date of Hearing: May 18, 2011 ASSEMBLY COMMITTEE ON APPROPRIATIONS Felipe Fuentes, Chair AB 1425 (Committee on Insurance) - As Introduced: March 22, 2011 Policy Committee: InsuranceVote:12 - 0 Urgency: No State Mandated Local Program: No Reimbursable: SUMMARY This bill requires regulations adopted by the Insurance Commissioner (IC) relating to life settlements to be adopted pursuant to the Administrative Procedure Act (APA). Specifically, this bill: 1)Repeals the delegation of authority to the IC to adopt regulations relating to life settlements. 2)Repeals the authorization to adopt those regulations as emergency regulations. 3)Provides an authorization for the IC to adopt regulations as reasonably necessary to implement the life settlement law using the non-emergency procedures required by the APA. FISCAL EFFECT The Department of Insurance indicates that the cost associated with replacing the emergency regulations with non-emergency regulations would be less than $30,000 and absorbable within their existing resources. COMMENTS Purpose . This bill is intended to modify the delegation to the IC of authority to adopt regulations to implement the life settlement law. When initially enacted, the bill created a new regulatory program. The authority to adopt regulations and the emergency regulation procedure were adopted in two separate AB 1425 Page 2 places in the statute. Further, the procedure as enacted authorized use of the emergency regulation procedure on an ongoing basis. The Legislative intent was to grant this expedited authority for the initial round of regulations necessary to implement the new law. However, the bill did not specify that the emergency regulation authority was limited to the initial regulations. This bill adopts standard language on authority and procedure in the same code section. Analysis Prepared by : Julie Salley-Gray / APPR. / (916) 319-2081