BILL ANALYSIS Ó
AB 764
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Date of Hearing: April 22, 2015
ASSEMBLY COMMITTEE ON INSURANCE
Tom Daly, Chair
AB 764
(Quirk) - As Amended April 16, 2015
SUBJECT: Parking lots: design: insurance discount
SUMMARY: Encourages insurers to provide discounts to property
owners who install protective vehicle barriers in parking lots.
Specifically, this bill:
1)Authorizes the California Building Standards Commission (CBSC)
to adopt building standards to require that the installation
of vehicle barriers be added to the list of considerations in
the design of any new commercial property parking lot.
2)Authorizes an insurer to consider providing discounts to
property owners that install vehicle barriers.
3)Provides that any discount that an insurer wishes to provide
must be consistent with the requirements of Proposition 103.
4)Defines "vehicle barrier" as a short vertical post placed to
protect buildings or pedestrians from collisions by motor
vehicles.
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EXISTING LAW:
1)Establishes the CBSC within the Department of General
Services, and requires any building standard adopted or
proposed by state agencies to be submitted to, and approved
by, the CBSC prior to codification into the California
Building Standards Code (CBC).
2)Establishes, by initiative statute, a comprehensive rate
regulation system implemented by the insurance commissioner
that governs the property and liability insurance rates that
insurers charge commercial property owners
FISCAL EFFECT: Undetermined.
COMMENTS:
1)Purpose. According to the author, this bill "seeks to provide
awareness of storefront crashes and encourage the use of
safety bollards in building design. A bollard is a vertical
pillar or safety device most often made of steel and concrete
and is installed in a footing in the ground and placed in a
line?to block a vehicle from crossing into a pedestrian,
shopping or seating area, or into a building. Specifically,
AB 764 would add bollard installation to this list of
considerations in the design of any new commercial property
parking lot. Additionally, it would authorize an insurer to
consider these bollards as a safety measure eligible for
discounted building insurance rates. By doing this, AB 764
will reduce the number of storefront crashes."
2)Background. According to the Texas A&M Transportation
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Institute (TTI), "With 500 people reportedly killed each year
by vehicles crashing into retail stores, sidewalk cafes, hair
salons and other businesses, low speed barrier crashes have
been called 'one of the largest unaddressed safety issues in
the country." According to TTI, these accidents occur most
frequently when a driver is entering or leaving a parking
space perpendicular to a building, and even at relatively low
speeds, can cause serious injury or death. However, TTI notes
that simple, preventative measures can protect pedestrians,
store employees, and patrons from being injured or killed when
thee accidents occur. In recognition of the safety risks
posed by errant vehicles and the increasingly important use of
protective barriers as a way to prevent or minimize the
damages from these types of accidents, the American Society
for Testing and Materials International (ASTM), an
international standards development organization, in
conjunction with the researchers at TTI, recently approved a
test standard, known as the Test Method for Low Speed Barriers
for Errant Vehicles, to set parameters for bollards, barriers,
and other devices most often seen protecting storefronts and
high-traffic pedestrian areas to help standardize the use of
protective barriers. Prior to the adoption of this standard,
there was no objective way to evaluate the effectiveness of
vertical pipes, decorative planters, and other devices that
could serve to protect a business from damages caused by a
vehicle-into-building collision.
3)Insurance incentives. There are a range of financial
incentives that might induce a business to invest in
safety-related capital expenditures, and insurance discounts
can be one of them. However, Proposition 103, as implemented
by the insurance commissioner, generally requires historical
loss-based actuarial data to justify a "discount" in insurance
premiums paid by an insured. To the extent that this bill
seeks to encourage insurance incentives as an inducement for
capital expenditures to construct safety features, it must be
recognized that insurers would be required to provide an
actuarial justification in a rate filing subject to the
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commissioner prior approval authority before a discount could
be offered.
REGISTERED SUPPORT / OPPOSITION:
Support
Storefront Safety Council
Opposition
None received
Analysis Prepared by:Mark Rakich / INS. / (916) 319-2086