Amended in Assembly March 26, 2015

California Legislature—2015–16 Regular Session

Assembly Bill No. 269

Introduced by Assembly Member Waldron

February 10, 2015

An act to amend Section begin delete 10095.5 end delete begin insert 10094 end insert of the Insurance Code, relating to insurance.

LEGISLATIVE COUNSEL’S DIGEST

AB 269, as amended, Waldron. Basic property insurance: California FAIR Plan.

Under existing law, the California FAIR (fair access to insurance requirements) Plan Association is a joint reinsurance association of state insurers that is established to, among other things, assist persons in securing basic property insurance for qualified property for which insurance cannot be obtained through the normal insurance market. begin delete Existing law requires the association to establish and maintain a toll-free telephone number through which persons may receive assistance in applying for insurance. end delete begin insert Existing law also establishes a governing committee for the association consisting of 9 insurers elected annually. The governing committee also includes nonvoting members including, one representative of insurance agents, one representative of insurance brokers, one representative of surplus line brokers, and one representative of the public, each appointed by the Governor. end insert

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This bill would make technical, nonsubstantive changes to those provisions.

end delete begin insert

This bill would provide that the governing committee shall have 8 members, eliminating one voting member of the governing committee. This bill would also provide for a second representative of the public, to be appointed by the Governor.

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Vote: majority. Appropriation: no. Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program: no.

The people of the State of California do enact as follows:

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begin insert SECTION 1. end insert   

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begin insert Section 10094 of the end insert begin insert Insurance Code end insert begin insert is amended
to read: end insert

10094.  

Within 30 days after the effective date of this chapter,
with the approval of the commissioner, all insurers licensed to
write and engaged in writing in this state, on a direct basis, basic
property insurance or any component thereof in multiperil policies,
shall establish an industry placement facility, the California FAIR
Plan Association, to formulate and administer a program for the
equitable apportionment among begin delete such end delete begin insert those end insert insurers of basic
property insurance begin delete which end delete begin insert that end insert may be afforded persons having an
interest in real or tangible personal property who, after diligent
effort begin delete (as end delete begin insert , as end insert specified in subdivision (a) of Section begin delete 10093), end delete begin insert 10093, end insert
are unable to procure begin delete such end delete begin insert that end insert insurance through normal channels
from an admitted insurer or a surplus line broker. Each begin delete such end delete
insurer, as a condition of its authority to transact begin delete such end delete begin insert these end insert kinds
of insurance in this state, shall participate in begin delete such end delete begin insert the end insert industry
placement facility program in accordance with rules to be
established by a governing committee consisting of begin delete nine end delete begin insert eight end insert
insurers elected annually in the manner to be provided in the
program. The governing committee shall, in addition, have as
nonvoting members one representative of insurance agents, one
representative of insurance brokers, one representative of surplus
line brokers, and begin delete one representative end delete begin insert two representatives end insert of the
public, each to be appointed by the Governor. The governing
committee may establish separate classifications of written
premiums for the purpose of equitable begin delete distribution end delete begin insert distribution, end insert
but shall not include premiums from automobile or farm risks. The
program may also provide, with the approval of the commissioner,
for assessment of all members in amounts sufficient to operate the
facility, and may establish maximum limits of liability to be placed
through the program, reasonable underwriting standards for
determining insurability of a risk, and commission to be paid to
the licensed producer designated by the applicant.

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SECTION 1.  

Section 10095.5 of the Insurance Code is amended
to read:

10095.5.  

(a) The association shall establish and maintain a
statewide toll-free “800” telephone number through which persons
may receive assistance in applying for insurance through the plan.
The association shall cause the number to be published in all
general distribution telephone directories in California.

(b) An insurance agent or broker transacting basic property
insurance shall either assist persons in making application for
insurance through the plan or provide persons who desire that
insurance with the toll-free telephone number established pursuant
to subdivision (a).

end delete