BILL ANALYSIS Ó
AB 1515
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CONCURRENCE IN SENATE AMENDMENTS
AB
1515 (Committee on Insurance)
As Amended May 19, 2015
Majority vote
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|ASSEMBLY: | 78-0 | (April 23, |SENATE: |38-0 |(August 20, |
| | |2015) | | |2015) |
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Original Committee Reference: INS.
SUMMARY: Makes numerous technical and clarifying changes to the
Insurance Code.
The Senate amendments:
1)Delay implementation of numerous provisions in this bill.
2)Extend the sunset date of the credit for reinsurance statute
to January 1, 2021.
3)Delete a section of this bill making technical changes to the
requirements for a long-term care insurance notice provided to
consumers.
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EXISTING LAW:
1) Requires automobile, property, life and disability insurers
to provide specified information regarding complaint
resolution processes and resources when first issuing a
policy.
2)Requires insurers to maintain specified levels of "risk based
capital" as a means to ensure their solvency.
3)Provides for the existence of multiple employer welfare
arrangements (MEWAs) which allow multiple small employers to
affiliate for the purpose of self-insuring employee health
insurance.
4)Requires an insurer to provide the insured a specified notice
regarding the fair settlement of insurance claims after a
claim is filed.
5)Requires insurance agents and brokers to provide specified
information on certain insurance related documents.
6)Requires most agents and brokers to notify the Department of
Insurance (DOI) of specified criminal convictions, bankruptcy
proceedings, and admissions or judicial findings related to
lying, cheating and stealing.
7)Requires a surplus lines broker to provide a specified notice
to the purchaser of a policy from a non-admitted insurer.
8)Corrects obsolete references to the Vehicle Code.
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9)Requires disability insurance policies that are neither health
insurance nor disability income policies to pay claims within
30 days.
10)Requires insurers to pay claims on a disability income
insurance policy to pay claims within 30 days.
11)Requires the commissioner to approve all settlements
negotiated on his behalf.
FISCAL EFFECT: According to the Senate Appropriations
Committee, pursuant to Senate Rule 28.8, negligible state costs.
COMMENTS:
Purpose. This bill is the annual insurance omnibus bill. It
contains numerous technical and/or clarifying changes to the
Insurance Code. Most notably, this bill corrects erroneous
cross-references to the vehicle code relating to individual
motor vehicle records (MVR). Under Proposition 103 (1988),
insurers are required to provide a "good driver" discount to
drivers with less than two "moving violations." Subsequent
legislation required insurers to use the number of "points" on a
driver's MVR when determining "good driver" status and when
determining auto insurance rates. Previous legislation altered
the numbering of the relevant Vehicle Code section and failed to
update the cross-references in the Insurance Code.
Analysis Prepared by: Paul Riches / INS. / (916)
319-2086 FN: 0001358
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