BILL NUMBER: AB 822	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Cooley

                        FEBRUARY 26, 2015

   An act to add Section 1063.18 to the Insurance Code, relating to
insurance.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 822, as introduced, Cooley. Insurance: California Insurance
Guarantee Association: insolvency.
   Existing law creates the California Insurance Guarantee
Association (CIGA) and requires all insurers admitted to transact
insurance in this state to become members. Existing law requires CIGA
to collect premium payments from members and to discharge covered
claims, as defined, of an insolvent insurer. CIGA is required to
allocate its claim payments and costs based on categories of
insurance, including, but not limited to, workers' compensation
claims and homeowners'claims.
   This bill would provide that the laws described above governing
CIGA do not require the final adjudication of claims in an insolvent
insurer's liquidation proceedings before a covered claim may be
submitted to CIGA. The bill would provide that these laws also do not
require a claim to first be adjudicated and approved by the
liquidator before CIGA pays and discharges a covered claim. The bill
would also provide that if the association provides written denial of
a claim, the person asserting the claim has one year to bring an
action against the association challenging the denial. This bill
would also provide that if the written denial is based on a failure
to exhaust other insurance available to pay the claim, a claim must
be reasserted against the association within 6 months after all other
insurance has been exhausted.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


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

  SECTION 1.  Section 1063.18 is added to the Insurance Code, to
read:
   1063.18.  (a) Nothing in this article requires the final
adjudication of claims in an insolvent insurer's liquidation
proceedings before a covered claim may be submitted to the California
Insurance Guarantee Association (CIGA). Nothing in this article
requires a claim to first be adjudicated and approved by the
liquidator before CIGA pays and discharges a covered claim. If a
claim is presented to the association and all requirements for
processing a covered claim are satisfied, the association shall
process the claim for payment under this article.
   (b) If the association provides a written denial of a claim, the
person asserting the claim shall have one year to bring an action
against the association challenging the denial. If the written denial
is based on the failure to exhaust other insurance available to pay
the claim, a claim must be reasserted against the association within
six months after all other insurance has been exhausted.