Amended in Senate August 19, 2016

Amended in Senate August 15, 2016

Amended in Assembly March 16, 2016

California Legislature—2015–16 Regular Session

Assembly BillNo. 1899


Introduced by Assembly Member Calderon

February 11, 2016


An act to amend, repeal, and add Section 1677 of the Insurance Code, relating to insurance.

LEGISLATIVE COUNSEL’S DIGEST

AB 1899, as amended, Calderon. Insurance: production agents: license examinations.

Existing law requires the Insurance Commissioner to give, at least once each month, in each of the cities in which he or she has an office, qualifying examinations for production agent licenses. Existing law requires every qualifying examination for a production agent license to be in writing and to be of sufficient scope to satisfy the commissioner that the applicant has sufficient knowledge of, and is reasonably familiar with, the insurance laws of this state and with the provisions, terms, and conditions of the insurance that may be transacted pursuant to the license sought, and that the applicant has a general and fair understanding of the obligations and duties of the holder of that license.

This bill, from January 1, 2018, to January 1, 2024, would require the examination for a license as a life agent, life-only agent, and accident and health agent be provided in English and Spanish. The bill would require the Insurance Commissioner to evaluate the qualifying examination taken in Spanish and submit a report to the Legislature by March 1, 2023, as provided.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

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

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SECTION 1.  

The Legislature finds and declares that it is
2essential that all of the state’s residents have access to vital health
3services that can prolong and enhance their lives, and that state
4government continues to take reasonable and effective actions that
5will facilitate access to these services.

end delete
6begin insert

begin insertSECTION 1.end insert  

end insert

begin insertThe Legislature finds and declares all of the
7following:end insert

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8
(a) Every citizen of California deserves equal access to the
9protection provided by various insurance products.

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10
(b) Spanish-speaking individuals make up a large portion of
11the population in California. Estimates from the 2014 American
12Community Survey (ACS) indicate that 38.6 percent of Californians
13report their ethnicity as Latino. The ACS data also indicates that
1422 percent of households in which Spanish is spoken have no
15member over 14 years of age who speaks English fluently or “very
16well.” According to research published by Florida State University
17in 2006, Latino households are less likely to own life insurance
18than the general population, with 34 percent of Latinos purchasing
19life insurance compared to 62 percent of the general population.
20A 2012 Insurance Barometer Study by the Life Insurance and
21Market Research Association found the same and concluded that
22a contributing factor to that difference is that Latino households
23are less likely to have contact with an insurance agent. The Latino
24population is expected to continue to grow in California, with 2014
25Department of Finance projections suggesting that Latinos are
26expected to number 23.7 million in 2050, or 47.6 percent of all
27Californians.

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28
(c) By offering the opportunity for Spanish-speaking individuals
29to take insurance licensing exams, California will increase the
30number of insurance agents and brokers able to serve
31Spanish-speaking consumers, while also opening a career path
32currently unavailable to this population.

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(d) Several insurance companies offer Spanish translations of
2the insurance products they offer, a practice the Legislature
3commends and encourages to be followed by every insurance
4company and every product offered in order to ensure that the
5consumer more fully understands the full scope of his or her
6coverage and can make more informed purchasing decisions.

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7
(e) The option to have the insurance licensure examination
8administered in Spanish will decrease potential miscommunication,
9increase agents’ understanding of their duties and obligations,
10and allow California to keep pace with the needs of its multilingual
11and multicultural insurance consumers.

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12
(f) It is essential that all of the state’s residents have access to
13vital health services that can prolong and enhance their lives, and
14that state government continues to take reasonable and effective
15actions that will facilitate access to these services.

end insert
16

SEC. 2.  

Section 1677 of the Insurance Code is amended to
17read:

18

1677.  

(a) Each qualifying examination for a license pursuant
19to this chapter shall be in writing and shall be of sufficient scope
20to satisfy the commissioner that the applicant has sufficient
21knowledge of, and is reasonably familiar with, the insurance laws
22of this state and with the provisions, terms, and conditions of the
23insurance that may be transacted pursuant to the license sought,
24and that the applicant has a general and fair understanding of the
25obligations and duties of the holder of that license.

26(b) On and after January 1, 2018, the examination for a license
27as a life agent, life-only agent, and accident and health agent shall
28be provided in English and Spanish.

29(c) The commissioner shall evaluate the qualifying examination
30taken in Spanish and submit a report of the results to the Legislature
31no later than March 1, 2023. The report shall be submitted in
32compliance with Section 9795 of the Government Code and shall
33include, but not be limited to, all of the following:

34(1) The number of people taking the examination.

35(2) The pass rate, including a comparison between the
36comparable licensing examination taken in English.

37(3) The number of licenseholders that sat for the examination
38provided in Spanish and passed the examination that remain
39licensed.

P4    1(4) The number of consumer complaints received and
2enforcement actions taken with regard to the licenseholders who
3passed the examination in Spanish.

4(d) This section shall remain in effect only until January 1, 2024,
5and as of that date is repealed, unless a later enacted statute, that
6is enacted before January 1, 2024, deletes or extends that date.

7

SEC. 3.  

Section 1677 is added to the Insurance Code, to read:

8

1677.  

(a) Each qualifying examination for a license pursuant
9to this chapter shall be in writing and shall be of sufficient scope
10to satisfy the commissioner that the applicant has sufficient
11knowledge of, and is reasonably familiar with, the insurance laws
12of this state and with the provisions, terms, and conditions of the
13insurance that may be transacted pursuant to the license sought,
14and that the applicant has a general and fair understanding of the
15obligations and duties of the holder of that license.

16(b) This section shall become operative on January 1, 2024.



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