Amended in Assembly April 18, 2016

Amended in Assembly March 30, 2016

California Legislature—2015–16 Regular Session

Assembly BillNo. 2588


Introduced by Assembly Member Chu

February 19, 2016


An act to amendbegin insert and repeal Sections 14027, 14030, and 14037 of, to amend, repeal, and addend insert Sections 1722, 1751.5, 14000, 14001,begin insert 14010,end insert 14020,begin insert 14021,end insert 14022, 14022.5, 14024, 14025,begin insert 14026,end insert 14028,begin insert 14029,end insert 14031, 14032, 14038, 14039, 14040, 14042, 14061, 14063, 14064,begin insert 14078,end insert 14080, 14090.1, 14097, and 14099 of,begin insert andend insert to add Sections 14025.1 and 14079 to,begin delete to repeal Sections 14027, 14030, and 14037 of, and to repeal and add Sections 14010, 14021, 14026, 14029, and 14078 of,end delete the Insurance Code, relating to insurance.

LEGISLATIVE COUNSEL’S DIGEST

AB 2588, as amended, Chu. Independent insurance adjusters.

Existing law, the Insurance Adjuster Act, sets forth various requirements with respect to operation as an insurance adjuster in this state, including, but not limited to, that the person be licensed, licensing qualifications and application requirements, codes of conduct, disciplinary actions, and nonresident and emergency licenses. The act defines the term, “insurance adjuster,” to include a person, other than a private investigator, who, for any consideration whatsoever, engages in business or accepts employment to furnish, or agrees to make, or makes, any investigation for the purpose of obtaining, information in the course of adjusting or otherwise participating in the disposal of, any claim under or in connection with a policy of insurance on behalf of an insurer or engages in soliciting insurance adjustment business. Any person who knowingly falsifies the fingerprints or photographs submitted as part of the application process is guilty of a felony, and any person who violates any other provision governing insurance adjusters is guilty of a misdemeanor punishable by a fine not to exceed $500, or by imprisonment in the county jail not to exceed one year, or by both that fine and imprisonment.begin insert Existing law prescribes a schedule for various insurance adjuster application, license, and license renewal fees.end insert

Thisbegin delete billend deletebegin insert bill, beginning January 1, 2018,end insert would revise and recast the above provisions by, among other things, changing the name of the act to the Independent Insurance Adjuster Act and redefining an “independent insurance adjuster” to mean an individual, a business entity, an independent contractor, or an employee of a contractor, who contracts for compensation with insurers, a person whose tax treatment by the insurers is consistent with that of an independent contractor rather than as an employee, and a person who investigates, negotiates, or settles property and casualty claims for insurers. The bill would expand the categories of persons exempt from the act to include, among others, an individual who is employed to investigate suspected fraudulent insurance claims but who does not adjust losses or determine claims payments, and a person who solely performsbegin delete executive, administrative, managerial,end deletebegin insert administrativeend insert or clericalbegin delete dutiesend deletebegin insert duties,end insert or any combinationbegin delete thereofend deletebegin insert thereof,end insert and who does not investigate, negotiate, or settle claims with policyholders, claimants, or their legal representative. The bill would impose additional information and educational requirements on applicants and would impose additional code of conduct requirements on licensees. The bill would revise the provisions relating to nonresident and emergency licenses with regards to qualifying for those licenses. The bill would also create an apprentice independent insurance adjuster license to facilitate the experience, education, and training necessary to ensure reasonable competency in the responsibilities and duties of an independent insurance adjuster and would set forth the various terms and conditions of the license, including an application fee to be fixedbegin delete by the Insurance Commissioner and reasonably related to the actual cost to the Department Of Insurance in performing its duties.end deletebegin insert at up to $170.end insert The bill would make an apprentice independent insurance adjuster subject to a felony conviction if he or she knowingly falsifies the fingerprints or photograph submitted as part of his or her application for a license. The bill would also make conforming changes. Because the bill would create a new crime, it would impose a state-mandated local program.begin insert The bill would also change various independent insurance adjuster application, license, and renewal fees, as prescribed.end insert

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

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

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

P3    1

SECTION 1.  

Section 1722 of the Insurance Code is amended
2to read:

3

1722.  

begin insert(a)end insertbegin insertend insertIf a natural person while licensed pursuant to the
4provisions of this chapter or Chapter 6 (commencing with Section
51760),begin insert Chapterend insert 7 (commencing with Section 1800), orbegin insert Chapterend insert 8
6(commencing with Section 1831) of this part,begin insert orend insert Part 5
7(commencing with Section 12140) of Divisionbegin delete 2, or Chapter 1
8(commencing with Section 14000) of Division 5end delete
begin insert 2end insert enters the
9military service of the United States and is in that service at a time
10prescribed for the filing of a renewal application, the filing of that
11application is waived, and the license held by that licensee at the
12time of his or her entry into military service shall remain in force
13during the period of that military service and until the end of the
14license year in which he or she is released from that service but
15not for less than six months after that release. During that period,
16that person may secure a license of the type held by him or her on
17his or her entry into military service upon the filing of an
18application and paying the fee therefor without the necessity of
19taking any examination or paying any penalty.

begin insert

20
(b)  This section shall remain in effect only until January 1,
212018, and as of that date is repealed, unless a later enacted statute,
22that is enacted before January 1, 2018, deletes or extends that
23date.

end insert
24begin insert

begin insertSEC. 2.end insert  

end insert

begin insertSection 1722 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to read:end insert

begin insert
25

begin insert1722.end insert  

(a) If a natural person while licensed pursuant to the
26provisions of this chapter or Chapter 6 (commencing with Section
271760), Chapter 7 (commencing with Section 1800), or Chapter 8
P4    1(commencing with Section 1831) of this part, Part 5 (commencing
2with Section 12140) of Division 2, or Chapter 1 (commencing with
3Section 14000) of Division 5 enters the military service of the
4United States and is in that service at a time prescribed for the
5filing of a renewal application, the filing of that application is
6waived, and the license held by that licensee at the time of his or
7her entry into military service shall remain in force during the
8period of that military service and until the end of the license year
9in which he or she is released from that service but not for less
10than six months after that release. During that period, that person
11may secure a license of the type held by him or her on his or her
12entry into military service upon the filing of an application and
13paying the fee therefor without the necessity of taking any
14examination or paying any penalty.

15
(b) This section shall become operative on January 1, 2018.

end insert
16

begin deleteSEC. 2.end delete
17
begin insertSEC. 3.end insert  

Section 1751.5 of the Insurance Code is amended to
18read:

19

1751.5.  

begin insert(a)end insertbegin insertend insertThe fees required by this chapter and by Chapter
206 (commencing with Section 1760), Chapter 7 (commencing with
21Section 1800), and Chapter 8 (commencing with Section 1831) of
22this partbegin delete and by Chapter 1 (commencing with Section 14000) of
23Division 5end delete
are filing fees, no portion of which shall be refunded
24whether or not the application is acted upon or the examination is
25taken.

begin insert

26
(b) This section shall remain in effect only until January 1, 2018,
27and as of that date is repealed, unless a later enacted statute, that
28is enacted before January 1, 2018, deletes or extends that date.

end insert
29begin insert

begin insertSEC. 4.end insert  

end insert

begin insertSection 1751.5 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
30read:end insert

begin insert
31

begin insert1751.5.end insert  

(a) The fees required by this chapter and by Chapter
326 (commencing with Section 1760), Chapter 7 (commencing with
33Section 1800), and Chapter 8 (commencing with Section 1831) of
34this part and by Chapter 1 (commencing with Section 14000) of
35Division 5 are filing fees, no portion of which shall be refunded
36whether or not the application is acted upon or the examination
37is taken.

38
(b) This section shall become operative on January 1, 2018.

end insert
P5    1

begin deleteSEC. 3.end delete
2
begin insertSEC. 5.end insert  

Section 14000 of the Insurance Code is amended to
3read:

4

14000.  

begin insert(a)end insertbegin insertend insertThis chapter may be cited as thebegin delete Independentend delete
5 Insurance Adjuster Act.

begin insert

6
(b) This section shall remain in effect only until January 1, 2018,
7and as of that date is repealed, unless a later enacted statute, that
8is enacted before January 1, 2018, deletes or extends that date.

end insert
begin delete
9

SEC. 4.  

Section 14001 of the Insurance Code is amended to
10read:

11

14001.  

As used in this chapter, the following terms have the
12following meanings:

13(a) “Catastrophe” means an event that results in a large number
14of deaths or injuries, causes extensive damage or destruction of
15facilities that provide and sustain human needs, produces an
16overwhelming demand on state and local response resources and
17mechanisms, causes a severe long-term effect on general economic
18activity, or severely affects state, local, and private sector
19capabilities to begin and sustain response activities.

20(b) “Commissioner” means the Insurance Commissioner.

21(c) “Department” means the Department of Insurance.

22(d) “Fingerprints” means an impression of the lines on the finger
23taken for the purposes of identification.

24(e) “Home state” means the District of Columbia and any state
25or territory of the United States in which an independent insurance
26adjuster maintains his, her, or its principal place of residence or
27business and is licensed to act as a resident independent insurance
28adjuster. If the resident state does not license independent insurance
29adjusters, the independent insurance adjuster may designate
30California as his, her, or its home state, provided that the
31independent insurance adjuster is licensed and in good standing.

32(f) “Individual” means a natural person.

33(g) “Licensee” means a person licensed under this chapter.

34(h) “Manager” means the individual under whose direction,
35control, charge, or management the business of a licensee is
36operated.

37(i) “Nonresident” means a person who is not a resident of
38California at the time of the performance of the act referred to in
39Section 14071.

P6    1(j) “Person” includes any individual, firm, company, association,
2organization, partnership, limited liability company, and
3corporation.

4

SEC. 5.  

Section 14010 of the Insurance Code is repealed.

5

SEC. 6.  

Section 14010 is added to the Insurance Code, to read:

6

14010.  

The commissioner shall administer and enforce the
7provisions of this chapter.

8

SEC. 7.  

Section 14020 of the Insurance Code is amended to
9read:

10

14020.  

(a) A person shall not engage in a business regulated
11by this chapter, or act or assume to act as, or represent himself or
12herself to be, a licensee unless he or she is licensed as an
13independent insurance adjuster in accordance with this chapter.

14(b) A person shall not falsely represent that he or she is
15employed by a licensee.

16

SEC. 8.  

Section 14021 of the Insurance Code is repealed.

17

SEC. 9.  

Section 14021 is added to the Insurance Code, to read:

18

14021.  

An independent insurance adjuster, for purposes of this
19chapter, is all of the following:

20(a) An individual, a business entity, an independent contractor,
21or an employee of a contractor, who contracts for compensation
22with insurers.

23(b) A person whose tax treatment by the insurers is consistent
24with that of an independent contractor rather than an employee,
25as defined in Section 3121 of Title 26 of the United States Code.

26(c) A person who investigates, negotiates, or settles property
27and casualty claims for insurers.

28

SEC. 10.  

Section 14022 of the Insurance Code is amended to
29read:

30

14022.  

This chapter does not apply to any of the following:

31(a) An officer or employee of the United States of America, or
32of this state or a political subdivision thereof, while that officer or
33employee is engaged in the performance of his or her official
34duties.

35(b) A person engaged exclusively in the business of obtaining
36and furnishing information as to the financial rating of persons.

37(c) A charitable philanthropic society or association duly
38incorporated under the laws of this state, which is organized and
39maintained for the public good and not for private profit.

P7    1(d) An attorney at law admitted to practice in California, when
2acting in his or her professional capacity as an attorney.

3(e) A licensed collection agency or an employee thereof while
4acting within the scope of his or her employment, while making
5an investigation incidental to the business of the agency, including
6an investigation of the location of a debtor or his or her property
7where the contract with an assignor creditor is for the collection
8of claims owed or due or asserted to be owed or due or the
9equivalent thereof.

10(f) An officer, director, manager, or employee of an authorized
11insurer, surplus line insurer, a risk retention group, or an
12attorney-in-fact of a reciprocal insurer.

13(g) A licensed insurance agent or broker, attorney-in-fact of a
14reciprocal insurer, or managing general agent of the insurer to
15whom claim authority has been granted by the insurer.

16(h) The legal owner of personal property that has been sold
17under a conditional sales agreement or a mortgagee under the terms
18of a chattel mortgage.

19(i) Any bank subject to the jurisdiction of the Commissioner of
20Business Oversight under Division 1 (commencing with Section
2199) of the Financial Code or the Comptroller of the Currency of
22the United States.

23(j) A person employed solely to obtain facts surrounding a claim
24or to furnish technical assistance to a licensed independent
25insurance adjuster.

26(k) Any building contractor, engineer, technical expert, or other
27person who is engaged by an insurer or licensed independent
28insurance adjuster to provide an expert or professional evaluation
29of the extent, cause, or origin of damage to the insured property,
30but who does not otherwise participate in the process of adjusting
31claims.

32(l) An individual who is employed to investigate suspected
33fraudulent insurance claims but who does not adjust losses or
34determine claims payments.

35(m) A person who solely performs executive, administrative,
36managerial, or clerical duties or any combination thereof and who
37does not investigate, negotiate, or settle claims with policyholders,
38claimants, or their legal representative.

P8    1(n) A licensed health care provider or its employee who provides
2managed care if the services do not include the determination of
3compensability.

4(o) A managed care organization or any of its employees who
5 provide managed care services if the services do not include the
6determination of compensability.

7(p) A person who settles only reinsurance or subrogation claims.

8(q) A United States manager of the United States branch of an
9alien insurer.

10(r) A person who investigates, negotiates, or settles life, accident
11and health, annuity, or disability insurance claims.

12(s) An individual employee, under a self-insured arrangement,
13who adjusts claims on behalf of his or her employer.

14

SEC. 11.  

Section 14022.5 of the Insurance Code is amended
15to read:

16

14022.5.  

(a) In the event of an emergency situation as declared
17by the commissioner, claims arising out of the emergency,
18catastrophe, disaster, or other similar occurrence may be adjusted
19by a nonlicensed independent insurance adjuster upon registration
20with the commissioner if all of the following requirements are met:

21(1) The work performed by the nonlicensed independent
22insurance adjuster is under the active direction, control, charge,
23or management of a licensed independent insurance adjuster or an
24insurer authorized to do business in this state.

25(2) Registration with the commissioner is accomplished within
26five working days from the date on which the nonlicensed
27independent insurance adjuster commences the claims adjusting
28activity in connection with the emergency situation.

29(b) “Registration,” within the meaning of this section, means a
30written letter to the commissioner, submitted by the supervising
31licensed independent insurance adjuster or admitted insurer, naming
32the nonlicensed independent insurance adjusters, identifying their
33independent insurance adjuster licenses held in other jurisdictions,
34and stating when their claims adjusting activity commenced.

35(c) Registration under this section is valid for a period of 90
36days from the date of the registration letter. Before the lapse of
37that period, the commissioner may grant further 90-day extensions
38 as he or she deems appropriate upon written request from the
39supervising licensed independent insurance adjuster or the admitted
40insurer.

P9    1

SEC. 12.  

Section 14024 of the Insurance Code is amended to
2read:

3

14024.  

(a) An individual application shall be verified and shall
4include all of the following:

5(1) The full legal name and business, resident, and mailing
6addresses of the applicant.

7(2) The name under which the applicant intends to do business.

8(3) The applicant’s birth date and social security number.

9(4) The application fees set forth in Section 14097.

10(5) A statement as to the general nature of the business in which
11the applicant intends to engage.

12(6) A statement as to the classifications under which the
13applicant desires to be qualified.

14(7) Two recent photographs of the applicant, of a type prescribed
15by the commissioner, and one classifiable set of his or her
16fingerprints, to be sent to a live scan fingerprint provider as directed
17by the department, if fingerprints are not submitted in person with
18a live scan fingerprinting service provider certified by the
19Department of Justice.

20(8) A verified statement of his or her experience qualifications,
21unless applying for an apprentice independent insurance adjuster
22license.

23(9) Other information, evidence, statements, or documents as
24may be required by the commissioner.

25(b) A business entity application shall be verified and shall
26include all of the following:

27(1) The full legal name and residence address of each of its
28partners, officers, and directors, and its manager.

29(2) The name under which the applicant intends to do business.

30(3) The name of a licensed independent insurance adjuster who
31is responsible for the business entities compliance with this chapter.

32(4) That the applicant paid the fees set forth in Section 14097.

33(5) A statement as to the general nature of the business in which
34the applicant intends to engage.

35(6) A statement as to the classifications under which the
36applicant desires to be qualified.

37(7) Other information, evidence, statements, or documents as
38may be required by the commissioner.

39

SEC. 13.  

Section 14025 of the Insurance Code is amended to
40read:

P10   1

14025.  

Before a license is granted, the applicant shall meet all
2of the following requirements:

3(a) Be at least 18 years of age.

4(b) Not have committed acts or crimes constituting grounds for
5denial of licensure under Sections 1668 and 1669.

6(c) Shall have had at least two years of experience in adjusting
7insurance claims or the equivalent thereof as determined by the
8commissioner, unless applying for an apprentice independent
9insurance adjuster license.

10(d) If the applicant resides in a state that does not license
11independent insurance adjusters, he or she is required to be licensed
12in good standing to designate California as his or her home state.

13(e) (1) Completed a 20-hour prelicensing education course of
14study.

15(2) A nonresident applicant currently licensed as a home state
16independent insurance adjuster in another state who has met that
17state’s prelicensing education requirements is exempt from
18completing the prelicensing education requirement.

19(f) Successfully passed the examination for the independent
20insurance adjuster license, unless he or she qualifies for an
21exemption in Section 14026.

22(g) Comply with those other qualifications that the commissioner
23may require by regulation.

24

SEC. 14.  

Section 14025.1 is added to the Insurance Code, to
25read:

26

14025.1.  

(a) The apprentice independent insurance adjuster
27license is a license to facilitate the experience, education, and
28training necessary to ensure reasonable competency in the
29responsibilities and duties of an independent insurance adjuster.

30(b) An individual applying for an apprentice independent
31insurance adjuster license shall submit an application in a format
32prescribed by the commissioner and shall declare under penalty
33of suspension, revocation, or refusal of the license that the
34statements made in the application are true, correct, and complete
35to the best of the individual’s knowledge and belief. Before
36approving the application, the commissioner shall determine that
37the individual meets all of the following:

38(1) Is at least 18 years of age.

39(2) Is a resident of California and has designated California as
40his or her home state.

P11   1(3) Has a business or mailing address in California for the
2acceptance of service of process.

3(4) Has not committed any act that is a ground for suspension,
4revocation, or denial of licensure as set forth in Sections 1668,
51668.1, and 1669.

6(5) Is trustworthy, reliable, and of good reputation, evidence of
7which may be determined by the commissioner.

8(6) Has paid the fees set forth in subdivision (h) of Section
914097.

10(c) The apprentice independent insurance adjuster license shall
11be subject to the following terms and conditions:

12(1) The applicant shall submit, with the apprentice independent
13insurance adjuster application, an attestation from a licensed
14independent insurance adjuster certifying that the apprentice will
15be subject to training, direction, and control by the licensed
16independent insurance adjuster and further certifying that the
17licensed independent insurance adjuster assumes responsibility
18for the actions of the apprentice in the apprentice’s capacity as an
19independent insurance adjuster.

20(2) The apprentice independent insurance adjuster is only
21authorized to adjust claims in California.

22(3) The apprentice independent insurance adjuster is restricted
23to participation in the investigation, settlement, and negotiation of
24claims subject to the review and final determination of the claim
25by a supervising licensed independent insurance adjuster.

26(4) Compensation of an apprentice independent insurance
27adjuster shall only be on a salaried or hourly basis.

28(5) The apprentice independent insurance adjuster shall not be
29required to take and successfully complete the independent
30insurance adjuster examination to adjust claims as an apprentice
31independent insurance adjuster. At any time during the
32apprenticeship, the apprentice independent insurance adjuster may
33choose to take the examination. If the individual takes and
34successfully completes the independent insurance adjuster exam,
35the apprentice independent insurance adjuster license shall
36automatically terminate and an independent insurance adjuster
37license shall be issued to that individual in its place.

38(6) The apprentice independent insurance adjuster license is
39valid for a period not to exceed 12 months and is nonrenewable.

P12   1(7) The licensee shall be subject to suspension, revocation, or
2denial pursuant to Sections 1668, 1668.1, and 1669.

3(8) The applicant shall submit two recent photographs of the
4applicant, of a type prescribed by the commissioner, and one
5classifiable set of his or her fingerprints, to be sent to a live scan
6fingerprint provider as directed by the department, if fingerprints
7are not submitted in person with a live scan fingerprinting service
8provider certified by the Department of Justice.

9

SEC. 15.  

Section 14026 of the Insurance Code is repealed.

10

SEC. 16.  

Section 14026 is added to the Insurance Code, to
11read:

12

14026.  

(a) An applicant for an independent insurance adjuster
13license, unless applying for an apprentice independent insurance
14adjuster license or crop insurance adjuster license, shall pass a
15written examination.

16(1) The examination shall test the knowledge of the applicant
17concerning the duties and responsibilities of an independent
18insurance adjuster and this code.

19(2) An applicant applying for an examination shall remit a
20nonrefundable fee as prescribed by the commissioner in Section
2114097.

22(b) An individual who applies for an independent insurance
23adjuster license in California who holds a home state license in
24another state as an independent insurance adjuster shall not be
25required to complete the examination if he or she successfully
26passed an examination as a condition of receiving an independent
27insurance adjuster license in his or her home state. This exemption
28applies to individuals who are currently licensed in their home
29state or if the home state license expired and the application is
30received by the commissioner within 90 days of expiration.

31(c) An individual who applies for an apprentice independent
32insurance adjuster license pursuant to Section 14025.1, and who
33adjusts claims in that capacity, shall not be required to take and
34successfully complete the independent insurance adjuster
35examination.

36

SEC. 17.  

Section 14027 of the Insurance Code is repealed.

37

SEC. 18.  

Section 14028 of the Insurance Code is amended to
38read:

39

14028.  

After a hearing, the commissioner may deny a license
40unless the application makes a showing satisfactory to the
P13   1commissioner that the applicant, if an individual, has not, or if the
2applicant is a person other than an individual, that its manager and
3each of its officers and partners have not done any of the following:

4(a) Been refused a license under this chapter or had a license
5revoked.

6(b) Been an officer, partner, or manager of any person who has
7been refused a license under this chapter or whose license has been
8revoked.

9(c) While unlicensed committed, or aided and abetted the
10commission of, any act for which a license is required by this
11chapter.

12(d) Committed any act or crime constituting grounds for denial
13of licensure under Section 1668.

14

SEC. 19.  

Section 14029 of the Insurance Code is repealed.

15

SEC. 20.  

Section 14029 is added to the Insurance Code, to
16read:

17

14029.  

Each organization licensed under this chapter shall
18designate an individual also licensed as an independent insurance
19adjuster to be responsible for the organization’s compliance with
20state law.

21

SEC. 21.  

Section 14030 of the Insurance Code is repealed.

22

SEC. 22.  

Section 14031 of the Insurance Code is amended to
23read:

24

14031.  

A hearing held under this chapter to determine whether
25an application for a license should be granted shall be conducted
26in accordance with Chapter 5 (commencing with Section 11501)
27of Part 1 of Division 3 of Title 2 of the Government Code, and the
28commissioner shall have all of the powers granted therein.

29

SEC. 23.  

Section 14032 of the Insurance Code is amended to
30read:

31

14032.  

The form and content of the license shall be determined
32by the commissioner.

33

SEC. 24.  

Section 14037 of the Insurance Code is repealed.

34

SEC. 25.  

Section 14038 of the Insurance Code is amended to
35read:

36

14038.  

(a) Any licensee or officer, director, or partner of a
37licensee may divulge to any law enforcement officer or district
38attorney, or to his or her representative, any information he or she
39may acquire as to any criminal offense, but he or she shall not
40divulge to any other person, except as he or she may be required
P14   1by law to do so, any information acquired by him or her except at
2the direction of the employer or client for whom the information
3was obtained.

4(b) A licensee or officer, director, or partner of a licensee shall
5not knowingly make any false report to his or her employer or
6client for whom information was being obtained.

7(c) A written report shall not be submitted to a client except by
8the licensee who shall exercise diligence in ascertaining whether
9or not the facts and information in that report are true and correct.

10(d) A licensee or officer, director, or partner of a licensee shall
11not use a badge in connection with the official activities of the
12licensee’s business.

13(e) A licensee or officer, director, or partner of a licensee shall
14not use a title, wear a uniform, use an insignia, use an identification
15card, or make any statement with the intent to give an impression
16that he or she is connected in any way with the federal government,
17a state government, or any political subdivision of a state
18government.

19(f) A licensee or officer, director, or partner of a licensee, shall
20not enter any private building or portion thereof without the consent
21of the owner or of the person in legal possession thereof.

22(g) A licensee shall not appear as an assignee party in any
23proceeding involving claim and delivery, replevin, or other
24possessory action, action to foreclose a chattel mortgage,
25mechanic’s lien, materialman’s lien, or any other lien.

26(h) A licensee shall not permit an agent in his or her own name
27to advertise, engage clients, furnish reports, or present bills to
28clients, or in any manner whatever to conduct business for which
29a license is required under this chapter. All business of the licensee
30shall be conducted in the name of and under the control of the
31licensee.

32(i) A licensee acting as an independent automobile damage
33appraiser or adjuster or as an automobile insurance claims adjuster,
34appraiser, or representative shall not receive any financial benefit
35from an automobile repair facility. “Financial benefit” means the
36receiving of any commission or gratuity, discount on repair costs,
37free repairs, employment by a repair facility, or possession of more
38than 3 percent direct ownership in an automobile repair facility
39located in this state.

P15   1

SEC. 26.  

Section 14039 of the Insurance Code is amended to
2read:

3

14039.  

A person licensed as an independent insurance adjuster
4shall not do any of the following:

5(a) Fail to disclose his or her full financial interest in a contract
6or agreement executed by him or her for the adjustment of a claim
7prior to the execution thereof.

8(b) Use any misrepresentation to solicit a contract or agreement
9to adjust a claim.

10(c) Solicit or accept remuneration from, or have a financial
11interest exceeding 3 percent in, any salvage, repair, or other firm
12that obtains business in connection with any claim that he or she
13has a contract or agreement to adjust.

14

SEC. 27.  

Section 14040 of the Insurance Code is amended to
15read:

16

14040.  

Any badge or cap insignia worn by a person who is a
17licensee, officer, director, or partner of a licensee shall be of a
18design approved by the commissioner, and shall bear on its face
19a distinctive word indicating the name of the licensee.

20

SEC. 28.  

Section 14042 of the Insurance Code is amended to
21read:

22

14042.  

(a) A licensee shall not conduct a business under a
23fictitious or other business name unless and until he or she has
24obtained the written authorization of the commissioner to do so.

25(b) The commissioner shall not authorize the use of a fictitious
26or other business name that is so similar to that of a public officer
27or agency or of that used by another licensee that the public may
28be confused or misled thereby.

29(c) The authorization shall require, as a condition precedent to
30the use of any fictitious name, that the licensee comply with Section
311724.5.

32(d) A licensee desiring to conduct his or her business under
33more than one fictitious business name shall obtain the
34authorization of the commissioner in the manner prescribed in this
35section for the use of that name.

36(e) The licensee shall pay a fee of ten dollars ($10) for each
37authorization to use an additional fictitious business name and for
38each change in the use of a fictitious business name. If the original
39license is issued in a nonfictitious name and authorization is
40requested to have the license reissued in a fictitious business name,
P16   1the licensee shall pay a fee of twelve dollars ($12) for that
2authorization.

3

SEC. 29.  

Section 14061 of the Insurance Code is amended to
4read:

5

14061.  

The commissioner may suspend or revoke a license
6issued under this chapter or may issue a restricted license in
7accordance with Section 14026.5 if he or she determines that the
8licensee or if the licensee is a person other than an individual, that
9any of its officers, directors, partners, or its designated responsible
10person has done any of the following:

11(a) Made any false statement or given any false information in
12connection with an application for a license or a renewal or
13reinstatement of a license.

14(b) Violated any provisions of this chapter.

15(c) Violated any rule of the commissioner adopted pursuant to
16the authority contained in this chapter.

17(d) Been convicted of any crime substantially related to the
18qualifications, functions, and duties of the holder of the registration
19or license in question.

20(e) Impersonated, or permitted or aided and abetted an employee
21to impersonate, a law enforcement officer or employee of the
22United States of America, or of any state or political subdivision
23thereof.

24(f) Committed or permitted any employee to commit any act,
25while the license was expired that would be cause for the
26suspension or revocation of a license, or grounds for the denial of
27an application for a license.

28(g) Willfully failed or refused to render to a client services or
29a report as agreed between the parties and for which compensation
30has been paid or tendered in accordance with the agreement of the
31parties.

32(h) Committed assault, battery, or kidnapping, or used force or
33violence on any person, without proper justification.

34(i) Knowingly violated or advised, encouraged, or assisted the
35violation of any court order or injunction in the course of business
36as a licensee.

37(j) Acted as a runner or capper for any attorney.

38(k) Committed any act that is a ground for denial of an
39application for license under this chapter.

P17   1(l) Purchased, possessed, or transported any tear gas weapon
2except as authorized by law. A violation of this subdivision may
3be punished by the suspension of a license for a period to be
4determined by the commissioner.

5

SEC. 30.  

Section 14063 of the Insurance Code is amended to
6read:

7

14063.  

The commissioner may suspend or revoke a license
8issued under this chapter or may issue a restricted license in
9accordance with Section 14026.5 if the commissioner determines
10that the licensee, if an individual, or if the licensee is a person other
11than an individual, that any of its officers, directors, partners, or
12its designated responsible person has done any of the following:

13(a) Used any letterhead, advertisement, or other printed matter,
14or in any matter whatever represented that he or she is an
15instrumentality of the federal government, or of a state or any
16political subdivision thereof.

17(b) Used a name different from that under which he or she is
18currently licensed in any advertisement, solicitation, or contract
19for business.

20

SEC. 31.  

Section 14064 of the Insurance Code is amended to
21read:

22

14064.  

(a) The commissioner may suspend or revoke a license
23issued under this chapter or may issue a restricted license in
24accordance with Section 14026.5 if the commissioner determines
25that the licensee, if an individual, or if the licensee is a person other
26than an individual, that any of its officers, directors, partners, or
27its designated responsible person has committed any act in the
28course of the licensee’s business constituting dishonesty or fraud.

29 (b) “Dishonesty or fraud” as used in this section includes, in
30addition to other acts not specifically enumerated herein, all of the
31following:

32(1) Knowingly making a false statement relating to evidence or
33information obtained in the course of employment, or knowingly
34publishing a slander or a libel in the course of business.

35(2) Using illegal means in the collection or attempted collection
36of a debt or obligation.

37(3) Manufacture of evidence.

38(4) Acceptance of employment adverse to a client or former
39client relating to a matter with respect to which the licensee has
P18   1obtained confidential information by reason of or in the course of
2his or her employment by that client or former client.

3(5) Impersonating, or permitting or aiding and abetting an
4employee to impersonate, a law enforcement officer or employee
5of the United States of America, or of any state or political
6subdivision thereof.

7

SEC. 32.  

Section 14078 of the Insurance Code is repealed.

8

SEC. 33.  

Section 14078 is added to the Insurance Code, to
9read:

10

14078.  

(a) Unless refused licensure pursuant to Sections 14060
11to 14065, inclusive, a nonresident person shall receive a
12nonresident independent insurance adjuster license if all of the
13following apply:

14(1) The applicant is currently licensed in good standing as an
15independent insurance adjuster in his, her, or its resident or home
16state.

17(2) The applicant paid the fees required by Section 14097.

18(3) The applicant submitted to the commissioner the completed
19application for licensure.

20(4) The applicant’s home state awards nonresident independent
21insurance adjuster licenses to residents of California on the same
22basis.

23(b) The commissioner may verify the independent insurance
24adjuster’s licensing status through any appropriate database,
25including the Producer Database maintained by the National
26Association of Insurance Commissioners, its affiliates or
27subsidiaries, or may request certification of good standing.

28(c) As a condition to the continuation of a nonresident
29independent insurance adjuster license, the licensee shall maintain
30a resident independent insurance adjuster license in his, her, or its
31home state.

32(1) The nonresident independent insurance adjuster license
33issued under this chapter shall terminate and be surrendered
34immediately to the commissioner if the resident independent
35insurance adjuster license terminates for any reason, unless the
36termination is due to the independent insurance adjuster being
37issued a new resident independent insurance adjuster license in
38his, her, or its new home state.

39(2) The nonresident independent insurance adjuster license shall
40terminate if the person’s home state does not award nonresident
P19   1independent insurance adjuster licenses to residents of California
2on the same basis.

3(3) (A) The licensee is required to give notice of resident
4independent insurance adjuster license termination to any state
5that issued a nonresident independent insurance adjuster license.

6(B) The notice is required to be given within 30 days of the
7termination date. If the resident independent insurance adjuster
8license was terminated for change in resident home state, then the
9notice is required to include both the previous and current address.

10(4) Maintaining a resident independent insurance adjuster license
11is required for the nonresident independent insurance adjuster
12license to remain valid.

13

SEC. 34.  

Section 14079 is added to the Insurance Code, to
14read:

15

14079.  

(a) An independent insurance adjuster shall be honest
16and fair in all communications with the insured, the insurer, and
17the public.

18(b) An independent insurance adjuster shall provide
19policyholders and claimants with prompt and knowledgeable
20service and courteous, fair, and objective treatment at all times.

21(c) An independent insurance adjuster shall not give legal advice
22and shall not deal directly with any policyholder or claimant who
23is represented by legal counsel without the consent of the legal
24counsel involved.

25(d) An independent insurance adjuster shall comply with all
26local, state, and federal privacy and information security laws.

27(e) An independent insurance adjuster shall identify himself or
28herself as an independent insurance adjuster and, if applicable,
29shall identify his or her employer when dealing with any
30policyholder or claimant.

31(f) An independent insurance adjuster shall not have any
32financial interest in any adjustment or shall not acquire for himself,
33herself, or any person any interest or title in salvage, without first
34receiving written authority from the principal.

35

SEC. 35.  

Section 14080 of the Insurance Code is amended to
36read:

37

14080.  

Any person who knowingly falsifies the fingerprints
38or photographs submitted under paragraph (7) of subdivision (a)
39of Section 14024 or paragraph (8) of subdivision (c) of Section
4014025.1 is guilty of a felony. Any person who violates any of the
P20   1other provisions of this chapter is guilty of a misdemeanor
2punishable by fine not to exceed five hundred dollars ($500), or
3by imprisonment in the county jail not to exceed one year, or by
4both the fine and imprisonment.

5

SEC. 36.  

Section 14090.1 of the Insurance Code is amended
6to read:

7

14090.1.  

(a) An individual who holds an independent insurance
8adjuster license and who is not exempt under subdivision (b) shall
9satisfactorily complete a minimum of 24 hours, of which three
10hours are to be in ethics, of continuing education courses pertinent
11to the duties and responsibilities of an independent insurance
12adjuster license and shall report the completion of this coursework
13to the insurance commissioner on a biennial basis in conjunction
14with his or her license renewal cycle.

15(b) This section does not apply to any of the following:

16(1) A licensee not licensed for one full year prior to the end of
17the applicable continuing education biennium.

18(2) A licensee holding a nonresident independent insurance
19adjuster license who has met the continuing education requirements
20of his or her designated home state.

21(3) An individual licensed as an independent insurance adjuster
22and as a property or casualty broker-agent, pursuant to Section
231625, who has met the continuing education requirements specified
24in Section 1749.3.

25(4) An individual licensed as an apprentice independent
26insurance adjuster pursuant to Section 14025.1.

27

SEC. 37.  

Section 14097 of the Insurance Code is amended to
28read:

29

14097.  

The amount of fees prescribed by this chapter, unless
30otherwise fixed, is that fixed in the following schedule:

31(a) The application fee for the qualifying examination for an
32original license is twenty-nine dollars ($29).

33(b) The application fee for an original branch office certificate
34is eighteen dollars ($18).

35(c) The fee for an original license application is an amount equal
36to the renewal fee in effect on the last regular renewal date before
37the date on which the license is issued, except that, if the license
38will expire less than one year after its issuance, then the fee is an
39amount equal to 50 percent of the renewal fee in effect on the last
40regular renewal date before the date on which the license is issued.
P21   1The commissioner may, by appropriate regulation, provide for the
2waiver or refund of the initial license fee where the license is issued
3less than 45 days before the date on which it will expire.

4(d) The renewal fee shall be fixed by the commissioner as
5follows:

6(1) For a license as an independent insurance adjuster, not more
7than one hundred eighteen dollars ($118).

8(2) For a branch office certificate, not more than twenty-four
9dollars ($24).

10(e) The application and license fee for classifications prescribed
11by the commissioner, in addition to those provided for in this
12chapter, and the application and license fees for a change in the
13type of business organization of a licensee, shall be in the amount
14prescribed by rule and regulation of the commissioner.

15(f) The delinquency fee shall be 50 percent of the renewal fee
16in effect on the date of expiration.

17(g) The fee for reexamination of an applicant is twelve dollars
18($12).

19(h) The application fee for an apprentice independent insurance
20adjuster license shall be fixed by the commissioner by regulation
21and shall be reasonably related to the actual cost to the department
22in performing its duties under this chapter.

23

SEC. 38.  

Section 14099 of the Insurance Code is amended to
24read:

25

14099.  

Application or license fees shall not be refunded
26pursuant to Section 1751.5.

27

SEC. 39.  

No reimbursement is required by this act pursuant to
28Section 6 of Article XIII B of the California Constitution because
29the only costs that may be incurred by a local agency or school
30district will be incurred because this act creates a new crime or
31infraction, eliminates a crime or infraction, or changes the penalty
32for a crime or infraction, within the meaning of Section 17556 of
33the Government Code, or changes the definition of a crime within
34the meaning of Section 6 of Article XIII B of the California
35Constitution.

end delete
36begin insert

begin insertSEC. 6.end insert  

end insert

begin insertSection 14000 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to read:end insert

begin insert
37

begin insert14000.end insert  

(a) This chapter may be cited as the Independent
38Insurance Adjuster Act.

39
(b) This section shall become operative on January 1, 2018.

end insert
P22   1begin insert

begin insertSEC. 7.end insert  

end insert

begin insertSection 14001 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
2read:end insert

3

14001.  

begin insert(a)end insertbegin insertend insertAs used in thisbegin delete chapter:end deletebegin insert chapter, the following terms
4have the following meanings:end insert

begin delete

5(a)

end delete

6begin insert(1)end insert “Commissioner” means the Insurance Commissioner.

begin delete

7(b)

end delete

8begin insert(2)end insert “Department” means the Department of Insurance.

begin delete

9(c)

end delete

10begin insert(3)end insert “Licensee” means a person licensed under this chapter.

begin delete

11(d)

end delete

12begin insert(4)end insert “Manager” means the individual under whose direction,
13control, charge, or management the business of a licensee is
14operated.

begin delete

15(e)

end delete

16begin insert(5)end insert “Person” includes any individual, firm, company,
17association, organization, partnership, limited liability company,
18and corporation.

begin insert

19
(b) This section shall remain in effect only until January 1, 2018,
20and as of that date is repealed, unless a later enacted statute, that
21is enacted before January 1, 2018, deletes or extends that date.

end insert
22begin insert

begin insertSEC. 8.end insert  

end insert

begin insertSection 14001 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to read:end insert

begin insert
23

begin insert14001.end insert  

(a) As used in this chapter, the following terms have
24the following meanings:

25
(1) “Catastrophe” means an event that results in a large number
26of deaths or injuries, causes extensive damage or destruction of
27facilities that provide and sustain human needs, produces an
28overwhelming demand on state and local response resources and
29mechanisms, causes a severe long-term effect on general economic
30activity, or severely affects state, local, and private sector
31capabilities to begin and sustain response activities.

32
(2) “Commissioner” means the Insurance Commissioner.

33
(3) “Department” means the Department of Insurance.

34
(4) “Fingerprints” means an impression of the lines on the
35finger taken for the purposes of identification.

36
(5) “Home state” means the District of Columbia and any state
37or territory of the United States in which an independent insurance
38adjuster maintains his, her, or its principal place of residence or
39business and is licensed to act as a resident independent insurance
40adjuster. If the resident state does not license independent
P23   1insurance adjusters for the line of authority sought, the independent
2insurance adjuster shall designate as his, her, or its home state
3either California or any state in which the independent insurance
4adjuster is licensed following an examination, provided that the
5independent insurance adjuster is licensed and in good standing
6in that state.

7
(6) “Individual” means a natural person.

8
(7) “Licensee” means a person licensed under this chapter.

9
(8) “Manager” means the individual under whose direction,
10control, charge, or management the business of a licensee is
11operated.

12
(9) “Nonresident” means a person who is not a resident of
13California at the time of the performance of the act referred to in
14Section 14071.

15
(10) “Person” includes any individual, firm, company,
16association, organization, partnership, limited liability company,
17and corporation.

18
(b) This section shall become operative on January 1, 2018.

end insert
19begin insert

begin insertSEC. 9.end insert  

end insert

begin insertSection 14010 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
20read:end insert

21

14010.  

begin insert(a)end insertbegin insertend insertThe department succeeds to and is vested with all
22the duties, powers, purposes, responsibilities, and jurisdiction
23previously vested in the Bureau of Collection and Investigative
24Services with respect to the licensing of insurance adjusters.

25Any reference to prior licensing shall be deemed to licensing
26under the Private Investigator and Adjuster Act.

27The commissioner shall administer and enforce the provisions
28of this chapter.

begin insert

29
(b) This section shall remain in effect only until January 1, 2018,
30and as of that date is repealed, unless a later enacted statute, that
31is enacted before January 1, 2018, deletes or extends that date.

end insert
32begin insert

begin insertSEC. 10.end insert  

end insert

begin insertSection 14010 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
33read:end insert

begin insert
34

begin insert14010.end insert  

(a) The commissioner shall administer and enforce
35the provisions of this chapter.

36
(b) This section shall become operative on January 1, 2018.

end insert
37begin insert

begin insertSEC. 11.end insert  

end insert

begin insertSection 14020 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
38read:end insert

39

14020.  

begin deleteNo end deletebegin insert(a)end insertbegin insertend insertbegin insertA end insertperson shallbegin insert notend insert engage in a business regulated
40by this chapter, or act or assume to act as, or represent himself or
P24   1herself to be, a licensee unless he or she is licensed under this
2chapter.

begin delete

3 No

end delete

4begin insert(b)end insertbegin insertend insertbegin insertAend insert person shallbegin insert notend insert falsely represent that he or she is employed
5by a licensee.

begin insert

6
(c) This section shall remain in effect only until January 1, 2018,
7and as of that date is repealed, unless a later enacted statute, that
8is enacted before January 1, 2018, deletes or extends that date.

end insert
9begin insert

begin insertSEC. 12.end insert  

end insert

begin insertSection 14020 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
10read:end insert

begin insert
11

begin insert14020.end insert  

(a) A person shall not engage in a business regulated
12by this chapter, or act or assume to act as, or represent himself
13or herself to be, a licensee unless he or she is licensed as an
14independent insurance adjuster in accordance with this chapter.

15
(b) A person shall not falsely represent that he or she is
16employed by a licensee.

17
(c) This section shall become operative on January 1, 2018.

end insert
18begin insert

begin insertSEC. 13.end insert  

end insert

begin insertSection 14021 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
19read:end insert

20

14021.  

begin insert(a)end insertbegin insertend insertAn insurance adjuster within the meaning of this
21chapter is a person other than a private investigator as defined in
22Section 7521 of the Business and Professions Code who, for any
23consideration whatsoever, engages in business or accepts
24employment to furnish, or agrees to make, or makes, any
25investigation for the purpose of obtaining, information in the course
26of adjusting or otherwise participating in the disposal of, any claim
27under or in connection with a policy of insurance on behalf of an
28insurer or engages in soliciting insurance adjustment business or
29aids an insurer in any manner with reference to:

30Crime or wrongs done or threatened against the United States
31of America or any state or territory of the United States of America;
32the identity, habits, conduct, business, occupation, honesty,
33integrity, credibility, knowledge, trustworthiness, efficiency,
34loyalty, activity, movement, whereabouts, affiliations, associations,
35transactions, acts, reputation, or character of any person; the
36location, disposition, or recovery of lost or stolen property; the
37cause or responsibility for fires, libels, losses, accidents, or damage
38or injury to persons or to property; or securing evidence to be used
39before any court, board, officer, or investigating committee.

begin delete

40 Notwithstanding

end delete

P25   1begin insert(b)end insertbegin insertend insertbegin insertNotwithstandingend insert any otherbegin delete provision ofend delete law, this section is
2in no way intended to limit the ability of a duly licensed
3independent insurance adjuster to perform the duties of an
4independent insurance adjuster for any other entity.

begin insert

5
(c) This section shall remain in effect only until January 1, 2018,
6and as of that date is repealed, unless a later enacted statute, that
7is enacted before January 1, 2018, deletes or extends that date.

end insert
8begin insert

begin insertSEC. 14.end insert  

end insert

begin insertSection 14021 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
9read:end insert

begin insert
10

begin insert14021.end insert  

(a) An independent insurance adjuster, for purposes
11of this chapter, is all of the following:

12
(1) An individual, a business entity, an independent contractor,
13or an employee of a contractor, who contracts for compensation
14with insurers.

15
(2) A person whose tax treatment by the insurers is consistent
16with that of an independent contractor rather than an employee,
17as defined in Section 3121 of Title 26 of the United States Code.

18
(3) A person who investigates, negotiates, or settles property
19and casualty claims for insurers.

20
(b) This section shall become operative on January 1, 2018.

end insert
21begin insert

begin insertSEC. 15.end insert  

end insert

begin insertSection 14022 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
22read:end insert

23

14022.  

begin insert(a)end insertbegin insertend insertThis chapter does not applybegin delete to:end deletebegin insert to any of the
24following:end insert

begin delete

25(a)

end delete

26begin insert(1)end insert A person employed exclusively and regularly by one
27employer in connection with the affairs ofbegin delete suchend deletebegin insert thatend insert employer only
28and where there exists an employer- employee relationship.

begin delete

29(b)

end delete

30begin insert(2)end insert An officer or employee of the United States of America, or
31of this state or a political subdivision thereof, whilebegin delete suchend deletebegin insert thatend insert
32 officer or employee is engaged in the performance of his or her
33official duties.

begin delete

34(c)

end delete

35begin insert(3)end insert A person engaged exclusively in the business of obtaining
36and furnishing information as to the financial rating of persons.

begin delete

37(d)

end delete

38begin insert(4)end insert A charitable philanthropic society or association duly
39incorporated under the laws of this state, which is organized and
40maintained for the public good and not for private profit.

begin delete

P26   1(e)

end delete

2begin insert(5)end insert An attorney at law in performing his or her duties asbegin delete such
3attorney at law.end delete
begin insert an attorney.end insert

begin delete

4(f)

end delete

5begin insert(6)end insert A licensed collection agency or an employee thereof while
6acting within the scope of his or her employment, while making
7an investigation incidental to the business of the agency, including
8an investigation of the location of a debtor or his or her property
9where the contract with an assignor creditor is for the collection
10of claims owed or due or asserted to be owed or due or the
11equivalent thereof.

begin delete

12(g)

end delete

13begin insert(7)end insert Admitted insurers and agents and insurance brokers licensed
14by the state, performing duties in connection with insurance
15transacted by them.

begin delete

16(h)

end delete

17begin insert(8)end insert The legal owner of personal propertybegin delete whichend deletebegin insert thatend insert has been
18sold under a conditional sales agreement or a mortgagee under the
19terms of a chattel mortgage.

begin delete

20(i)

end delete

21begin insert(9)end insert Any bank subject to the jurisdiction of the Commissioner
22ofbegin delete Financial Institutions of the State of Californiaend deletebegin insert Business
23Oversightend insert
under Division 1 (commencing with Section 99) of the
24Financial Code or the Comptroller of the Currency of the United
25States.

begin delete

26(j)

end delete

27begin insert(10)end insert A person engaged solely in the business of securing
28information about persons or property from public records.

begin delete

29(k)

end delete

30begin insert(11)end insert Any building contractor, engineer, technical expert, or
31other person who is engaged by an insurer or licensed adjuster to
32provide an expert or professional evaluation of the extent, cause,
33or origin of damage to the insured property, but who does not
34otherwise participate in the process of adjusting claims.

begin insert

35
(b) This section shall remain in effect only until January 1, 2018,
36and as of that date is repealed, unless a later enacted statute, that
37is enacted before January 1, 2018, deletes or extends that date.

end insert
38begin insert

begin insertSEC. 16.end insert  

end insert

begin insertSection 14022 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
39read:end insert

begin insert
40

begin insert14022.end insert  

(a) This chapter does not apply to any of the following:

P27   1
(1) An officer or employee of the United States of America, or
2of this state or a political subdivision thereof, while that officer
3or employee is engaged in the performance of his or her official
4duties.

5
(2) A person engaged exclusively in the business of obtaining
6and furnishing information as to the financial rating of persons.

7
(3) A charitable philanthropic society or association duly
8incorporated under the laws of this state, which is organized and
9maintained for the public good and not for private profit.

10
(4) An attorney at law admitted to practice in California, when
11acting in his or her professional capacity as an attorney.

12
(5) A licensed collection agency or an employee thereof while
13acting within the scope of his or her employment, while making
14an investigation incidental to the business of the agency, including
15an investigation of the location of a debtor or his or her property
16where the contract with an assignor creditor is for the collection
17of claims owed or due or asserted to be owed or due or the
18equivalent thereof.

19
(6) An officer, director, manager, or employee of an authorized
20insurer, surplus line insurer, a risk retention group, or an
21attorney-in-fact of a reciprocal insurer.

22
(7) A licensed insurance agent or broker or managing general
23agent of the insurer to whom claim authority has been granted by
24the insurer.

25
(8) The legal owner of personal property that has been sold
26under a conditional sales agreement or a mortgagee under the
27terms of a chattel mortgage.

28
(9) Any bank subject to the jurisdiction of the Commissioner of
29Business Oversight under Division 1 (commencing with Section
3099) of the Financial Code or the Comptroller of the Currency of
31the United States.

32
(10) A person employed solely to obtain facts surrounding a
33claim or to furnish technical assistance to a licensed independent
34insurance adjuster.

35
(11) Any building contractor, engineer, technical expert, or
36other person who is engaged by an insurer or licensed independent
37insurance adjuster to provide an expert or professional evaluation
38of the extent, cause, or origin of damage to the insured property,
39but who does not otherwise participate in the process of adjusting
40claims.

P28   1
(12) An individual who is employed to investigate suspected
2fraudulent insurance claims but who does not adjust losses or
3determine claims payments.

4
(13) A person who solely performs administrative or clerical
5duties, or any combination thereof, and who does not investigate,
6negotiate, or settle claims with policyholders, claimants, or their
7legal representative.

8
(14) A licensed health care provider or its employees who
9provides managed care if the services do not include the
10determination of compensability.

11
(15) A managed care organization or any of its employees who
12provide managed care services if the services do not include the
13determination of compensability.

14
(16) A person who settles only reinsurance or subrogation
15claims.

16
(17) A United States manager of the United States branch of an
17alien insurer.

18
(18) An individual employee, under a self-insured arrangement,
19who adjusts claims on behalf of his or her employer.

20
(19) An individual or business entity that investigates,
21negotiates, or settles workers’ compensation claims.

22
(b) This section shall become operative on January 1, 2018.

end insert
23begin insert

begin insertSEC. 17.end insert  

end insert

begin insertSection 14022.5 of the end insertbegin insertInsurance Codeend insertbegin insert is amended
24to read:end insert

25

14022.5.  

(a) In the event of an emergency situation as declared
26by the commissioner, claims arising out of the emergency,
27catastrophe, disaster, or other similar occurrence may be adjusted
28by a nonlicensed adjuster upon registration with the commissioner
29if all of the following requirements are met:

30(1) The work performed by the nonlicensed adjuster is under
31the active direction, control, charge, or management of a licensed
32adjuster or an insurer authorized to do business in this state.

33(2) Registration with the commissioner is accomplished within
3415 working days from the date on which the nonlicensed adjuster
35commences the claims adjusting activity in connection with the
36emergency situation.

37(b) “Registration,” within the meaning of this section,begin delete shall
38meanend delete
begin insert meansend insert a written letter to the commissioner, submitted by the
39supervising licensed adjuster or admitted insurer, naming the
40nonlicensed adjusters, identifying their adjuster licenses held in
P29   1other jurisdictions, and stating when their claims adjusting activity
2commenced.

3(c) Registration under this section is valid for a period of 180
4days from the date of the registration letter. Before the lapse of
5that period, the commissioner may grant further 180-day extensions
6as he or she deems appropriate upon written request from the
7supervising licensed adjuster or the admitted insurer.

begin insert

8
(d) This section shall remain in effect only until January 1, 2018,
9and as of that date is repealed, unless a later enacted statute, that
10is enacted before January 1, 2018, deletes or extends that date.

end insert
11begin insert

begin insertSEC. 18.end insert  

end insert

begin insertSection 14022.5 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
12read:end insert

begin insert
13

begin insert14022.5.end insert  

(a) In the event of an emergency situation as declared
14by the commissioner, claims arising out of the emergency,
15catastrophe, disaster, or other similar occurrence may be adjusted
16by a nonlicensed independent insurance adjuster upon registration
17with the commissioner if all of the following requirements are met:

18
(1) The work performed by the nonlicensed independent
19insurance adjuster is under the active direction, control, charge,
20or management of a licensed independent insurance adjuster or
21an insurer authorized to do business in this state.

22
(2) Registration with the commissioner is accomplished within
23five working days from the date on which the nonlicensed
24independent insurance adjuster commences the claims adjusting
25activity in connection with the emergency situation.

26
(b) “Registration,” within the meaning of this section, means
27a written letter to the commissioner, submitted by the supervising
28licensed independent insurance adjuster or admitted insurer,
29naming the nonlicensed independent insurance adjusters,
30identifying their independent insurance adjuster licenses held in
31other jurisdictions, and stating when their claims adjusting activity
32commenced.

33
(c) Registration under this section is valid for a period of 180
34days from the date of the registration letter. Before the lapse of
35that period, the commissioner may grant further 180-day extensions
36as he or she deems appropriate upon written request from the
37supervising licensed independent insurance adjuster or the
38admitted insurer.

39
(d) This section shall become operative on January 1, 2018.

end insert
P30   1begin insert

begin insertSEC. 19.end insert  

end insert

begin insertSection 14024 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
2read:end insert

3

14024.  

begin insert(a)end insertbegin insertend insertAn application shall be verified and shallbegin delete include:end delete
4
begin insert include all of the following:end insert

begin delete

5(a)

end delete

6begin insert(1)end insert The full name and business address of the applicant.

begin delete

7(b)

end delete

8begin insert(2)end insert The name under whichbegin insert theend insert applicant intends to do business.

begin delete

9(c)

end delete

10begin insert(3)end insert A statement as to the general nature of the business in which
11the applicant intends to engage.

begin delete

12(d)

end delete

13begin insert(4)end insert A statement as to thebegin delete classification orend delete classifications under
14which the applicant desires to be qualified.

begin delete

15(e)

end delete

16begin insert(5)end insert If the applicant is a person other than an individual, the full
17name and residence address of each of its partners, officers, and
18directors, and its manager.

begin delete

19(f)

end delete

20begin insert(6)end insert Two recent photographs of the applicant, of a type prescribed
21by the commissioner, and two classifiable sets of his or her
22fingerprints.

begin delete

23(g)

end delete

24begin insert(7)end insert A verified statement of his or her experience qualifications.

begin delete

25(h) Such other

end delete

26begin insert(8)end insertbegin insertend insertbegin insertOtherend insert information, evidence, statements, or documents as
27may be required by the commissioner.

28(b) This section shall remain in effect only until January 1, 2018,
29and as of that date is repealed, unless a later enacted statute, that
30is enacted before January 1, 2018, deletes or extends that date.

31begin insert

begin insertSEC. 20.end insert  

end insert

begin insertSection 14024 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
32read:end insert

begin insert
33

begin insert14024.end insert  

(a) An individual application shall be verified and
34shall include all of the following:

35
(1) The full legal name and business, residence, and mailing
36addresses of the applicant.

37
(2) The name under which the applicant intends to do business.

38
(3) The applicant’s birth date and social security number.

39
(4) The application fees set forth in Section 14097.

P31   1
(5) A statement as to the general nature of the business in which
2the applicant intends to engage.

3
(6) A statement as to the classifications under which the
4applicant desires to be qualified.

5
(7) Two photographs, no more than six months old, of the
6applicant, of a type prescribed by the commissioner, and one
7classifiable set of his or her fingerprints, to be sent to a live scan
8fingerprint provider as directed by the department, if fingerprints
9are not submitted in person with a live scan fingerprinting service
10provider certified by the Department of Justice.

11
(8) A verified statement of his or her experience qualifications,
12unless applying for an apprentice independent insurance adjuster
13license.

14
(9) Other information, evidence, statements, or documents as
15may be required by the commissioner.

16
(b) A business entity application shall be verified and shall
17include all of the following:

18
(1) The full legal name and residence address of each of its
19partners, officers, and directors, and its manager.

20
(2) The name under which the applicant intends to do business.

21
(3) That the applicant paid the fees set forth in Section 14097.

22
(4) A statement as to the general nature of the business in which
23the applicant intends to engage.

24
(5) A statement as to the classifications under which the
25applicant desires to be qualified.

26
(6) Other information, evidence, statements, or documents as
27may be required by the commissioner.

28
(c) This section shall become operative on January 1, 2018.

end insert
29begin insert

begin insertSEC. 21.end insert  

end insert

begin insertSection 14025 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
30read:end insert

31

14025.  

begin insert(a)end insertbegin insertend insertBefore an application for a license is granted, the
32applicant, or his or her manager, shall meet all of the following:

begin delete

33(a)

end delete

34begin insert(1)end insert Be at least 18 years of age.

begin delete

35(b)

end delete

36begin insert(2)end insert Not have committed acts or crimes constituting grounds for
37denial of licensure under Section 480 of the Business and
38Professions Code.

begin delete

39(c)

end delete

P32   1begin insert(3)end insert Shall have had at least two years of experience in adjusting
2insurance claims or the equivalent thereof as determined by the
3commissioner.

begin delete

4(d)

end delete

5begin insert(4)end insert Comply withbegin delete suchend deletebegin insert thoseend insert other qualifications as the
6commissioner may fix bybegin delete rule.end deletebegin insert regulation.end insert

begin insert

7
(b) This section shall remain in effect only until January 1, 2018,
8and as of that date is repealed, unless a later enacted statute, that
9is enacted before January 1, 2018, deletes or extends that date.

end insert
10begin insert

begin insertSEC. 22.end insert  

end insert

begin insertSection 14025 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
11read:end insert

begin insert
12

begin insert14025.end insert  

(a) Before a license is granted, the applicant shall meet
13all of the following requirements:

14
(1) Be at least 18 years of age.

15
(2) Not have committed acts or crimes constituting grounds for
16denial of licensure under Sections 1668 and 1669.

17
(3) Have had either of the following:

18
(A) At least two years of experience in adjusting insurance
19claims or the equivalent thereof as determined by the
20commissioner, unless applying for an apprentice independent
21insurance adjuster license.

22
(B) One year as a licensed apprentice independent insurance
23adjuster, which is considered the equivalent of two years of
24experience in adjusting claims.

25
(4) If the applicant resides in a state that does not license
26independent insurance adjusters, he or she is required to be
27licensed in good standing to designate California as his or her
28home state.

29
(5) (A) Completed a 20-hour prelicensing education course of
30study.

31
(B) A nonresident applicant currently licensed as a home state
32independent insurance adjuster in another state who has met that
33state’s prelicensing education requirements is exempt from
34completing the prelicensing education requirement.

35
(C) A resident applicant currently listed under a licensed
36independent insurance adjuster’s license as an unlicensed
37employee is exempt from completing the prelicensing education
38requirement. This exemption shall be in effect only until January
391, 2019.

P33   1
(6) Successfully passed the examination for the independent
2insurance adjuster license, unless he or she qualifies for an
3exemption in Section 14026.

4
(7) Comply with those other qualifications that the commissioner
5may require by regulation.

6
(b) This section shall become operative on January 1, 2018.

end insert
7begin insert

begin insertSEC. 23.end insert  

end insert

begin insertSection 14025.1 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
8read:end insert

begin insert
9

begin insert14025.1.end insert  

(a) The apprentice independent insurance adjuster
10license is a license to facilitate the experience, education, and
11training necessary to ensure reasonable competency in the
12responsibilities and duties of an independent insurance adjuster.

13
(b) An individual applying for an apprentice independent
14insurance adjuster license shall submit an application in a format
15prescribed by the commissioner and shall declare under penalty
16of suspension, revocation, or refusal of the license that the
17statements made in the application are true, correct, and complete
18to the best of the individual’s knowledge and belief. Before
19approving the application, the commissioner shall determine that
20the individual meets all of the following:

21
(1) Is at least 18 years of age.

22
(2) Is a resident of California or is a resident of another state
23and has designated California as his or her home state.

24
(3) Has a business or mailing address in California for the
25acceptance of service of process.

26
(4) Has not committed any act that is a ground for suspension,
27revocation, or denial of licensure as set forth in Sections 1668,
281668.1, and 1669.

29
(5) Has paid the fees set forth in paragraph (8) of subdivision
30(a) of Section 14097.

31
(c) The apprentice independent insurance adjuster license shall
32be subject to the following terms and conditions:

33
(1) The applicant shall submit, with the apprentice independent
34insurance adjuster application, an attestation from a licensed
35independent insurance adjuster certifying that the apprentice will
36be subject to training, direction, and control by the licensed
37independent insurance adjuster and further certifying that the
38licensed independent insurance adjuster assumes responsibility
39for the actions of the apprentice in the apprentice’s capacity as
40an apprentice independent insurance adjuster.

P34   1
(2) The apprentice independent insurance adjuster is only
2authorized to adjust claims in California.

3
(3) The apprentice independent insurance adjuster is restricted
4to participation in the investigation, settlement, and negotiation
5of claims subject to the review and final determination of the claim
6by a supervising licensed independent insurance adjuster.

7
(4) The apprentice independent insurance adjuster shall not be
8required to take and successfully complete the independent
9insurance adjuster examination to adjust claims as an apprentice
10independent insurance adjuster. At any time during the
11apprenticeship, the apprentice independent insurance adjuster
12may choose to take the examination. If the individual takes and
13successfully completes the independent insurance adjuster exam,
14the apprentice independent insurance adjuster license shall
15automatically terminate and an independent insurance adjuster
16license shall be issued to that individual in its place.

17
(5) The apprentice independent insurance adjuster license is
18valid for a period not to exceed 12 months and is nonrenewable.

19
(6) The licensee shall be subject to suspension, revocation, or
20denial pursuant to Sections 1668, 1668.1, and 1669.

21
(7) The applicant shall submit two photographs, no more than
22six months old, of the applicant, of a type prescribed by the
23commissioner, and one classifiable set of his or her fingerprints,
24to be sent to a live scan fingerprint provider as directed by the
25department, if fingerprints are not submitted in person with a live
26scan fingerprinting service provider certified by the Department
27of Justice.

28
(d) This section shall become operative on January 1, 2018.

end insert
29begin insert

begin insertSEC. 24.end insert  

end insert

begin insertSection 14026 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
30read:end insert

31

14026.  

begin insert(a)end insertbegin insertend insertThe commissioner may require an applicant, or his
32or her manager, to demonstrate his or her qualifications by a written
33or oral examination, or a combination of both.

begin insert

34
(b) This section shall remain in effect only until January 1, 2018,
35and as of that date is repealed, unless a later enacted statute, that
36is enacted before January 1, 2018, deletes or extends that date.

end insert
37begin insert

begin insertSEC. 25.end insert  

end insert

begin insertSection 14026 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
38read:end insert

begin insert
39

begin insert14026.end insert  

(a) An applicant for an independent insurance adjuster
40license, unless applying for an apprentice independent insurance
P35   1adjuster license or crop insurance adjuster license, shall pass a
2written examination.

3
(1) The examination shall test the knowledge of the applicant
4concerning the duties and responsibilities of an independent
5insurance adjuster and this code.

6
(2) An applicant applying for an examination shall remit a
7nonrefundable fee as prescribed by the commissioner in Section
814097.

9
(b) An individual who applies for an independent insurance
10adjuster license in California who holds a home state license in
11another state as an independent insurance adjuster shall not be
12required to complete the examination if he or she successfully
13passed an examination as a condition of receiving an independent
14insurance adjuster license in his or her home state. This exemption
15applies to individuals who are currently licensed in their home
16state or if the home state license expired and the application is
17received by the commissioner within 90 days of expiration.

18
(c) An individual who applies for an apprentice independent
19insurance adjuster license pursuant to Section 14025.1, and who
20adjusts claims in that capacity, shall not be required to take and
21successfully complete the independent insurance adjuster
22examination.

23
(d) This section shall become operative on January 1, 2018.

end insert
24begin insert

begin insertSEC. 26.end insert  

end insert

begin insertSection 14027 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
25read:end insert

26

14027.  

begin insert(a)end insertbegin insertend insertPayment of the application fee prescribed by this
27chapter entitles an applicant, or his or her manager, to one
28examination without further charge. If the person fails to pass the
29examination, he or she shall not be eligible for any subsequent
30examination except upon payment of the reexamination fee
31prescribed by this chapter for eachbegin delete suchend delete subsequent examination.

begin insert

32
(b) This section shall remain in effect only until January 1, 2018,
33and as of that date is repealed, unless a later enacted statute, that
34is enacted before January 1, 2018, deletes or extends that date.

end insert
35begin insert

begin insertSEC. 27.end insert  

end insert

begin insertSection 14028 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
36read:end insert

37

14028.  

begin insert(a)end insertbegin insertend insertAfter abegin delete hearingend deletebegin insert hearing,end insert the commissioner may
38deny a license unless the application makes a showing satisfactory
39to the commissioner that the applicant, if an individual, has not,
40or if the applicant is a person other than an individual, that its
P36   1manager and each of its officers and partners havebegin delete not:end deletebegin insert not done
2any of the following:end insert

begin delete

3(a)

end delete

4begin insert(1)end insert Committed any acts or crimes constituting grounds for denial
5of licensure under Section 480 of the Business and Professions
6Code.

begin delete

7(b)

end delete

8begin insert(2)end insert Been refused a license under this chapter or had a license
9revoked.

begin delete

10(c)

end delete

11begin insert(3)end insert Been an officer, partner, or manager of any person who has
12been refused a license under this chapter or whose license has been
13revoked.

begin delete

14(d)

end delete

15begin insert(4)end insert While unlicensed committed, or aided and abetted the
16commission of, any act for which a license is required by this
17chapter.

begin delete

18(e)

end delete

19begin insert(5)end insert Committed any act or crime constituting grounds for denial
20ofbegin delete licenseend deletebegin insert licensureend insert under Section 1668.

begin insert

21
(b) This section shall remain in effect only until January 1, 2018,
22and as of that date is repealed, unless a later enacted statute, that
23is enacted before January 1, 2018, deletes or extends that date.

end insert
24begin insert

begin insertSEC. 28.end insert  

end insert

begin insertSection 14028 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
25read:end insert

begin insert
26

begin insert14028.end insert  

(a) After a hearing, the commissioner may deny a
27license unless the application makes a showing satisfactory to the
28commissioner that the applicant, if an individual, has not, or if the
29applicant is a person other than an individual, that its manager
30and each of its officers and partners have not done any of the
31following:

32
(1) Been refused a license under this chapter or had a license
33revoked.

34
(2) Been an officer, partner, or manager of any person who has
35been refused a license under this chapter or whose license has
36been revoked.

37
(3) While unlicensed committed, or aided and abetted the
38commission of, any act for which a license is required by this
39chapter.

P37   1
(4) Committed any act or crime constituting grounds for denial
2of licensure under Section 1668.

3
(b) This section shall become operative on January 1, 2018.

end insert
4begin insert

begin insertSEC. 29.end insert  

end insert

begin insertSection 14029 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
5 read:end insert

6

14029.  

(a) The business of each licensee shall be operated
7under the active direction, control, charge, or management of the
8licensee, if the licensee is qualified, or the person who has qualified
9to act as the licensee’s manager, if the licensee is not qualified.

10(b) No person shall act as a manager of a licensee until he or
11she has complied with each of the following:

12(1) Demonstrated his or her qualifications by a written or oral
13examination, or a combination of both, if required by the
14commissioner.

15(2) Made a satisfactory showing to the commissioner that he or
16she has the qualifications prescribed by Section 14025 and that
17none of the facts stated in Section 14028 or 14028.5 exist as to
18him or her.

19(c) If the manager, who has qualified as provided in this section,
20ceases for any reason whatsoever to be connected with the licensee
21to whom the license is issued, the licensee shall notify the
22commissioner in writing 30 days from the cessation. If notice is
23given, the license shall remain in force for a reasonable length of
24time to be determined by the rules of the commissioner pending
25the qualifications, as provided in this chapter, of another manager.
26If the licensee fails to notify the commissioner within the 30-day
27period, his or her license shall be subject to suspension or
28revocation and may be reinstated only upon the filing of an
29application for reinstatement, payment of the reinstatement fee, if
30any is due, and the qualification of a manager as provided herein.

31(d) Every manager shall renew his or her authority by satisfying
32the requirements of Article 8 (commencing with Section 14090).

begin insert

33
(e) This section shall remain in effect only until January 1, 2018,
34and as of that date is repealed, unless a later enacted statute, that
35is enacted before January 1, 2018, deletes or extends that date.

end insert
36begin insert

begin insertSEC. 30.end insert  

end insert

begin insertSection 14029 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
37read:end insert

begin insert
38

begin insert14029.end insert  

(a) Each organization licensed under this chapter shall
39designate an individual also licensed as an independent insurance
P38   1adjuster to be responsible for the organization’s compliance with
2state law.

3
(b) This section shall become operative on January 1, 2018.

end insert
4begin insert

begin insertSEC. 31.end insert  

end insert

begin insertSection 14030 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
5read:end insert

6

14030.  

begin insert(a)end insertbegin insertend insertWhenever the individual on the basis of whose
7qualifications a license under this chapter has been obtained ceases
8to be connected with the licensee for any reason whatever, the
9business may be carried on forbegin delete suchend deletebegin insert aend insert temporary period and under
10begin delete suchend deletebegin insert theend insert terms and conditions as the commissioner shall provide
11by regulation.

begin insert

12
(b) This section shall remain in effect only until January 1, 2018,
13and as of that date is repealed, unless a later enacted statute, that
14is enacted before January 1, 2018, deletes or extends that date.

end insert
15begin insert

begin insertSEC. 32.end insert  

end insert

begin insertSection 14031 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
16read:end insert

17

14031.  

begin insert(a)end insertbegin insertend insert Whenever a hearing is held under this chapter to
18determine whether an application for a license should be granted
19or to determine the qualifications of a licensee’s manager, the
20proceedings shall be conducted in accordance with Chapter 5
21(commencing with Section 11501) of Part 1 of Division 3 of Title
222 of the Government Code, and the commissioner shall have all
23of the powers granted therein.

begin insert

24
(b) This section shall remain in effect only until January 1, 2018,
25and as of that date is repealed, unless a later enacted statute, that
26is enacted before January 1, 2018, deletes or extends that date.

end insert
27begin insert

begin insertSEC. 33.end insert  

end insert

begin insertSection 14031 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
28read:end insert

begin insert
29

begin insert14031.end insert  

(a) A hearing held under this chapter to determine
30whether an application for a license should be granted shall be
31conducted in accordance with Chapter 5 (commencing with Section
3211501) of Part 1 of Division 3 of Title 2 of the Government Code,
33and the commissioner shall have all of the powers granted therein.

34
(b) This section shall be operative on January 1, 2018.

end insert
35begin insert

begin insertSEC. 34.end insert  

end insert

begin insertSection 14032 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
36read:end insert

37

14032.  

begin insert(a)end insertbegin insertend insertThe form and content of the license shall be
38determined by the commissioner in accordance with Section 164
39of the Business and Professions Code.

begin insert

P39   1
(b) This section shall remain in effect only until January 1, 2018,
2and as of that date is repealed, unless a later enacted statute, that
3is enacted before January 1, 2018, deletes or extends that date.

end insert
4begin insert

begin insertSEC. 35.end insert  

end insert

begin insertSection 14032 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
5read:end insert

begin insert
6

begin insert14032.end insert  

(a) The form and content of the license shall be
7determined by the commissioner.

8
(b) This section shall become operative on January 1, 2018.

end insert
9begin insert

begin insertSEC. 36.end insert  

end insert

begin insertSection 14037 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
10read:end insert

11

14037.  

begin insert(a)end insertbegin insertend insertA licensee shall at all times be legally responsible
12for the good conduct in the business of each of his or her employees
13or agents, including his or her manager.

begin insert

14
(b) This section shall remain in effect only until January 1, 2018,
15and as of that date is repealed, unless a later enacted statute, that
16is enacted before January 1, 2018, deletes or extends that date.

end insert
17begin insert

begin insertSEC. 37.end insert  

end insert

begin insertSection 14038 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
18read:end insert

19

14038.  

(a) Any licensee or officer, director, partner, or manager
20of a licensee may divulge to any law enforcement officer or district
21attorney, or to his or her representative, any information he or she
22may acquire as to any criminal offense, but he or she shall not
23divulge to any other person, except as he or she may be required
24by law to do so, any information acquired by him or her except at
25the direction of the employer or client for whom the information
26was obtained.

27(b) begin deleteNo end deletebegin insertA end insertlicensee or officer, director, partner, manager, or
28employee of a licensee shallbegin insert notend insert knowingly make any false report
29to his or her employer or client for whom information was being
30obtained.

31(c) begin deleteNo end deletebegin insertA end insertwritten report shallbegin insert notend insert be submitted to a client except
32by the licensee, qualifying manager, or a person authorized by one
33or either of them, andbegin delete suchend deletebegin insert theend insert person submitting the report shall
34exercise diligence in ascertaining whether or not the facts and
35information inbegin delete such aend deletebegin insert thatend insert report are true and correct.

36(d) begin deleteNo licensee, end deletebegin insertA licensee end insertor officer, director, partner, manager,
37or employee of a licensee shallbegin insert notend insert use a badge in connection with
38the official activities of the licensee’s business.

39(e) begin deleteNo licensee, end deletebegin insertA licensee end insertor officer, director, partner, manager,
40or employee of a licensee, shallbegin insert notend insert use a title,begin delete orend delete wear a uniform,
P40   1begin delete orend delete use an insignia, or use an identification card, or make any
2statement with the intent to give an impression that he or she is
3connected in any way with the federal government, a state
4government, or any political subdivision of a state government.

5(f) begin deleteNo licensee, end deletebegin insertA licensee end insertor officer, director, partner, manager,
6or employee of a licensee, shallbegin insert notend insert enter any private building or
7portion thereof without the consent of the owner or of the person
8in legal possession thereof.

9(g) begin deleteNo end deletebegin insertA end insertlicensee shallbegin insert notend insert appear as an assignee party in any
10proceeding involving claim and delivery, replevin, or other
11possessory action, action to foreclose a chattel mortgage,
12mechanic’s lien, materialman’s lien, or any other lien.

13(h) begin deleteNo end deletebegin insertA end insertlicensee shallbegin insert notend insert permit an employee or agent in his
14or her own name to advertise, engage clients, furnish reports, or
15present bills to clients, or in any manner whatever to conduct
16business for which a license is required under this chapter. All
17business of the licensee shall be conducted in the name of and
18under the control of the licensee.

19(i) begin deleteNo end deletebegin insertA end insertlicensee acting as an independent automobile damage
20appraiser or adjuster or as an automobile insurance claims adjuster,
21begin delete appraiserend deletebegin insert appraiser,end insert or representative shallbegin insert notend insert receive any financial
22benefit from an automobile repair facility. “Financial benefit”
23means the receiving of any commission or gratuity, discount on
24repair costs, free repairs, employment by a repair facility, or
25possession of more than 3 percent direct ownership in an
26automobile repair facility located in this state.

begin insert

27
(j) This section shall remain in effect only until January 1, 2018,
28and as of that date is repealed, unless a later enacted statute, that
29is enacted before January 1, 2018, deletes or extends that date.

end insert
30begin insert

begin insertSEC. 38.end insert  

end insert

begin insertSection 14038 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
31read:end insert

begin insert
32

begin insert14038.end insert  

(a) Any licensee or officer, director, or partner of a
33licensee may divulge to any law enforcement officer or district
34attorney, or to his or her representative, any information he or
35she may acquire as to any criminal offense, but he or she shall not
36divulge to any other person, except as he or she may be required
37by law to do so, any information acquired by him or her except at
38the direction of the employer or client for whom the information
39was obtained.

P41   1
(b) A licensee or officer, director, or partner of a licensee shall
2not knowingly make any false report to his or her employer or
3client for whom information was being obtained.

4
(c) A written report shall not be submitted to a client except by
5the licensee who shall exercise diligence in ascertaining whether
6or not the facts and information in that report are true and correct.

7
(d) A licensee or officer, director, or partner of a licensee shall
8not use a badge in connection with the official activities of the
9licensee’s business.

10
(e) A licensee or officer, director, or partner of a licensee shall
11not use a title, wear a uniform, use an insignia, use an
12identification card, or make any statement with the intent to give
13an impression that he or she is connected in any way with the
14federal government, a state government, or any political
15subdivision of a state government.

16
(f) A licensee or officer, director, or partner of a licensee, shall
17not enter any private building or portion thereof without the
18consent of the owner or of the person in legal possession thereof.

19
(g) A licensee shall not appear as an assignee party in any
20proceeding involving claim and delivery, replevin, or other
21possessory action, action to foreclose a chattel mortgage,
22mechanic’s lien, materialman’s lien, or any other lien.

23
(h) A licensee shall not permit an agent in his or her own name
24to advertise, engage clients, furnish reports, or present bills to
25clients, or in any manner whatever to conduct business for which
26a license is required under this chapter. All business of the licensee
27shall be conducted in the name of and under the control of the
28licensee.

29
(i) A licensee acting as an independent automobile damage
30appraiser or adjuster or as an automobile insurance claims
31adjuster, appraiser, or representative shall not receive any
32financial benefit from an automobile repair facility. “Financial
33benefit” means the receiving of any commission or gratuity,
34discount on repair costs, free repairs, employment by a repair
35facility, or possession of more than 3 percent direct ownership in
36an automobile repair facility located in this state.

37
(j) This section shall become operative on January 1, 2018.

end insert
38begin insert

begin insertSEC. 39.end insert  

end insert

begin insertSection 14039 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
39read:end insert

P42   1

14039.  

begin deleteNo end deletebegin insert(a)end insertbegin insertend insertbegin insertA end insertperson licensed as an insurance adjuster shall
2begin insert notend insert do any of the following:

begin delete

3(a)

end delete

4begin insert(1)end insert Fail to disclose his or her full financial interest in a contract
5 or agreement executed by him or her for the adjustment of a claim
6prior to the execution thereof.

begin delete

7(b)

end delete

8begin insert(2)end insert Use any misrepresentation to solicit a contract or agreement
9to adjust a claim.

begin delete

10(c)

end delete

11begin insert(3)end insert Solicit or accept remuneration from, or have a financial
12interest exceeding 3 percent in, any salvage, repair, or otherbegin delete firm,
13whichend delete
begin insert firm thatend insert obtains business in connection with any claim
14begin delete whichend deletebegin insert thatend insert he or she has a contract or agreement to adjust.

begin insert

15
(b) This section shall remain in effect only until January 1, 2018,
16and as of that date is repealed, unless a later enacted statute, that
17is enacted before January 1, 2018, deletes or extends that date.

end insert
18begin insert

begin insertSEC. 40.end insert  

end insert

begin insertSection 14039 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
19read:end insert

begin insert
20

begin insert14039.end insert  

(a) A person licensed as an independent insurance
21adjuster shall not do any of the following:

22
(1) Fail to disclose his or her full financial interest in a contract
23or agreement executed by him or her for the adjustment of a claim
24prior to the execution thereof.

25
(2) Use any misrepresentation to solicit a contract or agreement
26to adjust a claim.

27
(3) Solicit or accept remuneration from, or have a financial
28interest exceeding 3 percent in, any salvage, repair, or other firm
29that obtains business in connection with any claim that he or she
30has a contract or agreement to adjust.

31
(b) This section shall become operative on January 1, 2018.

end insert
32begin insert

begin insertSEC. 41.end insert  

end insert

begin insertSection 14040 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
33read:end insert

34

14040.  

begin insert(a)end insertbegin insertend insertAny badge or cap insignia worn by a person who
35is a licensee, officer, director, partner, manager, or employee of a
36licensee shall be of a design approved by the commissioner, and
37shall bear on its face a distinctive word indicating the name of the
38licensee and an employee number by whichbegin delete suchend deletebegin insert theend insert person may
39be identified by the licensee.

begin insert

P43   1
(b) This section shall remain in effect only until January 1, 2018,
2and as of that date is repealed, unless a later enacted statute, that
3is enacted before January 1, 2018, deletes or extends that date.

end insert
4begin insert

begin insertSEC. 42.end insert  

end insert

begin insertSection 14040 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
5read:end insert

begin insert
6

begin insert14040.end insert  

(a) Any badge or cap insignia worn by a person who
7is a licensee, officer, director, or partner of a licensee shall be of
8a design approved by the commissioner, and shall bear on its face
9a distinctive word indicating the name of the licensee.

10
(b) This section shall become operative on January 1, 2018.

end insert
11begin insert

begin insertSEC. 43.end insert  

end insert

begin insertSection 14042 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
12read:end insert

13

14042.  

begin deleteNo end deletebegin insert(a)end insertbegin insertend insertbegin insertA end insertlicensee shallbegin insert notend insert conduct a business under
14a fictitious or other business name unless and until he or she has
15obtained the written authorization of the commissioner to do so.

begin delete

16 The

end delete

17begin insert(b)end insertbegin insertend insertbegin insertTheend insert commissioner shall not authorize the use of a fictitious
18or other business namebegin delete whichend deletebegin insert thatend insert is so similar to that of a public
19officer or agency or of that used by another licensee that the public
20may be confused or misled thereby.

begin delete

21 The

end delete

22begin insert(c)end insertbegin insertend insertbegin insertTheend insert authorization shall require, as a condition precedent to
23the use of any fictitious name, that the licensee comply with Section
241724.5 of this code and Chapter 5 (commencing with Section
2517900) of Part 3 of Division 7 of the Business and Professions
26Code.

begin delete

27 A

end delete

28begin insert(d)end insertbegin insertend insertbegin insertAend insert licensee desiring to conduct his or her business under more
29than one fictitious business name shall obtain the authorization of
30the commissioner in the manner prescribed in this section for the
31use ofbegin delete each suchend deletebegin insert thatend insert name.

begin delete

32 The

end delete

33begin insert(e)end insertbegin insertend insertbegin insertTheend insert licensee shall pay a fee of ten dollars ($10) for each
34authorization to use an additional fictitious business name and for
35each change in the use of a fictitious business name. If the original
36license is issued in a nonfictitious name and authorization is
37requested to have the license reissued in a fictitious business name,
38the licensee shall pay a fee of twelve dollars ($12) forbegin delete suchend deletebegin insert thatend insert
39 authorization.

begin insert

P44   1
(f) This section shall remain in effect only until January 1, 2018,
2and as of that date is repealed, unless a later enacted statute, that
3is enacted before January 1, 2018, deletes or extends that date.

end insert
4begin insert

begin insertSEC. 44.end insert  

end insert

begin insertSection 14042 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
5read:end insert

begin insert
6

begin insert14042.end insert  

(a) A licensee shall not conduct a business under a
7fictitious or other business name unless and until he or she has
8obtained the written authorization of the commissioner to do so.

9
(b) The commissioner shall not authorize the use of a fictitious
10or other business name that is so similar to that of a public officer
11or agency or of that used by another licensee that the public may
12be confused or misled thereby.

13
(c) The authorization shall require, as a condition precedent to
14the use of any fictitious name, that the licensee comply with Section
151724.5.

16
(d) A licensee desiring to conduct his or her business under
17more than one fictitious business name shall obtain the
18authorization of the commissioner in the manner prescribed in
19this section for the use of that name.

20
(e) The licensee shall pay a fee of ten dollars ($10) for each
21authorization to use an additional fictitious business name and
22for each change in the use of a fictitious business name. If the
23original license is issued in a nonfictitious name and authorization
24is requested to have the license reissued in a fictitious business
25name, the licensee shall pay a fee of twelve dollars ($12) for that
26authorization.

27
(f) This section shall become operative on January 1, 2018.

end insert
28begin insert

begin insertSEC. 45.end insert  

end insert

begin insertSection 14061 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
29read:end insert

30

14061.  

begin insert(a)end insertbegin insertend insertThe commissioner may suspend or revoke a license
31issued under this chapter or may issue a restricted license in
32accordance with Section 14026.5 if he or she determines that the
33licensee, or his or her manager, if an individual, or if the licensee
34is a person other than an individual, that any of its officers,
35directors, partners, or itsbegin delete manager, has:end deletebegin insert manager has done any of
36the following:end insert

begin delete

37(a)

end delete

38begin insert(1)end insert Made any false statement or given any false information in
39connection with an application for a license or a renewal or
40reinstatement of a license.

begin delete

P45   1(b)

end delete

2begin insert(2)end insert Violated any provisions of this chapter.

begin delete

3(c)

end delete

4begin insert(3)end insert Violated any rule of the commissioner adopted pursuant to
5the authority contained in this chapter.

begin delete

6(d)

end delete

7begin insert(4)end insert Been convicted of any crime substantially related to the
8qualifications,begin delete functionsend deletebegin insert functions,end insert and duties of the holder of the
9registration or license in question.

begin delete

10(e)

end delete

11begin insert(5)end insert Impersonated, or permitted or aided and abetted an employee
12tobegin delete impersonateend deletebegin insert impersonate,end insert a law enforcement officer or employee
13of the United States of America, or of any state or political
14subdivision thereof.

begin delete

15(f)

end delete

16begin insert(6)end insert Committed or permitted any employee to commit any act,
17while the license was expiredbegin delete whichend deletebegin insert thatend insert would be cause for the
18suspension or revocation of a license, or grounds for the denial of
19an application for a license.

begin delete

20(g)

end delete

21begin insert(7)end insert Willfully failed or refused to render to a client services or
22a report as agreed between the parties and for which compensation
23has been paid or tendered in accordance with the agreement of the
24parties.

begin delete

25(h)

end delete

26begin insert(8)end insert Committed assault, battery, or kidnapping, or used force or
27violence on any person, without proper justification.

begin delete

28(i)

end delete

29begin insert(9)end insert Knowinglybegin delete violated,end deletebegin insert violatedend insert or advised, encouraged, or
30assisted the violation of any court order or injunction in the course
31of business as a licensee.

begin delete

32(j)

end delete

33begin insert(10)end insert Acted as a runner or capper for any attorney.

begin delete

34(k)

end delete

35begin insert(11)end insert Committed any actbegin delete whichend deletebegin insert thatend insert is a ground for denial of an
36application for license under this chapter.

begin delete

37(l) Purchased, possessed, or transported any tear gas weapon
38except as authorized by law. A violation of this subdivision may
39be punished by the suspension of a license for a period to be
40determined by the commissioner.

end delete
begin insert

P46   1
(12) Purchased, possessed, or transported any tear gas weapon
2except as authorized by law. A violation of this paragraph may be
3punished by the suspension of a license for a period to be
4determined by the commissioner.

end insert
begin insert

5
(b) This section shall remain in effect only until January 1, 2018,
6and as of that date is repealed, unless a later enacted statute, that
7is enacted before January 1, 2018, deletes or extends that date.

end insert
8begin insert

begin insertSEC. 46.end insert  

end insert

begin insertSection 14061 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
9read:end insert

begin insert
10

begin insert14061.end insert  

(a) The commissioner may suspend or revoke a license
11issued under this chapter or may issue a restricted license in
12accordance with Section 14026.5 if he or she determines that the
13licensee or if the licensee is a person other than an individual, that
14any of its officers, directors, partners, or its designated responsible
15person has done any of the following:

16
(1) Made any false statement or given any false information in
17connection with an application for a license or a renewal or
18reinstatement of a license.

19
(2) Violated any provisions of this chapter.

20
(3) Violated any rule of the commissioner adopted pursuant to
21the authority contained in this chapter.

22
(4) Been convicted of any crime substantially related to the
23qualifications, functions, and duties of the holder of the registration
24or license in question.

25
(5) Impersonated, or permitted or aided and abetted an
26employee to impersonate, a law enforcement officer or employee
27of the United States of America, or of any state or political
28subdivision thereof.

29
(6) Committed or permitted any employee to commit any act,
30while the license was expired that would be cause for the
31suspension or revocation of a license, or grounds for the denial
32of an application for a license.

33
(7) Willfully failed or refused to render to a client services or
34a report as agreed between the parties and for which compensation
35has been paid or tendered in accordance with the agreement of
36the parties.

37
(8) Committed assault, battery, or kidnapping, or used force or
38violence on any person, without proper justification.

P47   1
(9) Knowingly violated or advised, encouraged, or assisted the
2violation of any court order or injunction in the course of business
3as a licensee.

4
(10) Acted as a runner or capper for any attorney.

5
(11) Committed any act that is a ground for denial of an
6application for license under this chapter.

7
(12) Purchased, possessed, or transported any tear gas weapon
8except as authorized by law. A violation of this paragraph may be
9punished by the suspension of a license for a period to be
10determined by the commissioner.

11
(b) This section shall become operative on January 1, 2018.

end insert
12begin insert

begin insertSEC. 47.end insert  

end insert

begin insertSection 14063 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
13read:end insert

14

14063.  

begin insert(a)end insertbegin insertend insertThe commissioner may suspend or revoke a license
15issued under this chapter or may issue a restricted license in
16accordance with Section 14026.5 if the commissioner determines
17that the licensee, or his or her manager, if an individual, or if the
18licensee is a person other than an individual, that any of its officers,
19directors, partners, or itsbegin delete manager, has:end deletebegin insert manager has done any of
20the following:end insert

begin delete

21(a)

end delete

22begin insert(1)end insert Used any letterhead, advertisement, or other printed matter,
23or in any matter whatever represented that he or she is an
24instrumentality of the federal government,begin insert or ofend insert a state or any
25political subdivision thereof.

begin delete

26(b)

end delete

27begin insert(2)end insert Used a name different from that under which he or she is
28currently licensed in any advertisement, solicitation, or contract
29for business.

begin insert

30
(b) This section shall remain in effect only until January 1, 2018,
31and as of that date is repealed, unless a later enacted statute, that
32is enacted before January 1, 2018, deletes or extends that date.

end insert
33begin insert

begin insertSEC. 48.end insert  

end insert

begin insertSection 14063 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
34read:end insert

begin insert
35

begin insert14063.end insert  

(a) The commissioner may suspend or revoke a license
36issued under this chapter or may issue a restricted license in
37accordance with Section 14026.5 if the commissioner determines
38that the licensee, if an individual, or if the licensee is a person
39other than an individual, that any of its officers, directors, or
40partners has done any of the following:

P48   1
(1) Used any letterhead, advertisement, or other printed matter,
2or in any matter whatever represented that he or she is an
3instrumentality of the federal government, or of a state or any
4political subdivision thereof.

5
(2) Used a name different from that under which he or she is
6currently licensed in any advertisement, solicitation, or contract
7for business.

8
(b) The section shall become operative on January 1, 2018.

end insert
9begin insert

begin insertSEC. 49.end insert  

end insert

begin insertSection 14064 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
10read:end insert

11

14064.  

begin insert(a)end insertbegin insertend insertThe commissioner may suspend or revoke a license
12issued under this chapter or may issue a restricted license in
13accordance with Section 14026.5 if the commissioner determines
14that the licensee, or his or her manager, if an individual, or if the
15licensee is a person other than an individual, that any of its officers,
16directors, partners, or its manager, has committed any act in the
17course of the licensee’s business constituting dishonesty or fraud.

begin delete

18 “Dishonesty

end delete

19begin insert(b)end insertbegin insertend insertbegin insert“Dishonestyend insert or fraud” as used in this section includes, in
20addition to other acts not specifically enumerated herein, all of the
21following:

begin delete

22(a)

end delete

23begin insert(1)end insert Knowingly making a false statement relating to evidence or
24information obtained in the course of employment, or knowingly
25publishing a slander or a libel in the course of business.

begin delete

26(b)

end delete

27begin insert(2)end insert Using illegal means in the collection or attempted collection
28of a debt or obligation.

begin delete

29(c)

end delete

30begin insert(3)end insert Manufacture of evidence.

begin delete

31(d)

end delete

32begin insert(4)end insert Acceptance of employment adverse to a client or former
33client relating to a matter with respect to which the licensee has
34obtained confidential information by reason of or in the course of
35his or her employment bybegin delete suchend deletebegin insert thatend insert client or former client.

begin delete

36(e)

end delete

37begin insert(5)end insert Impersonating, or permitting or aiding and abetting an
38employee tobegin delete impersonateend deletebegin insert impersonate,end insert a law enforcement officer
39or employee of the United States of America, or of any state or
40political subdivision thereof.

begin insert

P49   1
(c) This section shall remain in effect only until January 1, 2018,
2and as of that date is repealed, unless a later enacted statute, that
3is enacted before January 1, 2018, deletes or extends that date.

end insert
4begin insert

begin insertSEC. 50.end insert  

end insert

begin insertSection 14064 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
5read:end insert

begin insert
6

begin insert14064.end insert  

(a) The commissioner may suspend or revoke a license
7issued under this chapter or may issue a restricted license in
8accordance with Section 14026.5 if the commissioner determines
9that the licensee, if an individual, or if the licensee is a person
10other than an individual, that any of its officers, directors, partners,
11or its designated responsible person has committed any act in the
12course of the licensee’s business constituting dishonesty or fraud.

13
(b) “Dishonesty or fraud” as used in this section includes, in
14addition to other acts not specifically enumerated herein, all of
15the following:

16
(1) Knowingly making a false statement relating to evidence or
17information obtained in the course of employment, or knowingly
18publishing a slander or a libel in the course of business.

19
(2) Using illegal means in the collection or attempted collection
20of a debt or obligation.

21
(3) Manufacture of evidence.

22
(4) Acceptance of employment adverse to a client or former
23client relating to a matter with respect to which the licensee has
24obtained confidential information by reason of or in the course of
25his or her employment by that client or former client.

26
(5) Impersonating, or permitting or aiding and abetting an
27employee to impersonate, a law enforcement officer or employee
28of the United States of America, or of any state or political
29subdivision thereof.

30
(c) This section shall become operative on January 1, 2018.

end insert
31begin insert

begin insertSEC. 51.end insert  

end insert

begin insertSection 14078 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
32read:end insert

33

14078.  

begin insert(a)end insertbegin insertend insertAs used in this article, “nonresident” means a
34person who is not a resident of this state at the time of the
35performance of the act referred to in Section 14071.

begin insert

36
(b) This section shall remain in effect only until January 1, 2018,
37and as of that date is repealed, unless a later enacted statute, that
38is enacted before January 1, 2018, deletes or extends that date.

end insert
39begin insert

begin insertSEC. 52.end insert  

end insert

begin insertSection 14078 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
40read:end insert

begin insert
P50   1

begin insert14078.end insert  

(a) Unless refused licensure pursuant to Sections 14060
2to 14065, inclusive, a nonresident person shall receive a
3nonresident independent insurance adjuster license if all of the
4following apply:

5
(1) The applicant is currently licensed in good standing as an
6independent insurance adjuster in his, her, or its resident or home
7state.

8
(2) The applicant paid the fees required by Section 14097.

9
(3) The applicant submitted to the commissioner the completed
10application for licensure.

11
(4) The applicant’s home state issues nonresident independent
12insurance adjuster licenses to residents of California on the same
13basis.

14
(b) The commissioner may verify the independent insurance
15adjuster’s licensing status through any appropriate database,
16including the Producer Database maintained by the National
17Association of Insurance Commissioners, its affiliates or
18subsidiaries, or may request certification of good standing.

19
(c) As a condition to the continuation of a nonresident
20independent insurance adjuster license, the licensee shall maintain
21a resident independent insurance adjuster license in his, her, or
22its home state.

23
(1) The nonresident independent insurance adjuster license
24issued under this chapter shall terminate and be surrendered
25immediately to the commissioner if the resident independent
26insurance adjuster license terminates for any reason, unless the
27termination is due to the independent insurance adjuster being
28issued a new resident independent insurance adjuster license in
29his, her, or its new home state.

30
(2) The nonresident independent insurance adjuster license
31shall terminate if the person’s home state does not issue
32nonresident independent insurance adjuster licenses to residents
33of California on the same basis.

34
(3) (A) The licensee is required to give notice of resident
35independent insurance adjuster license termination to any state
36that issued a nonresident independent insurance adjuster license.

37
(B) The notice is required to be given within 30 days of the
38termination date. If the resident independent insurance adjuster
39license was terminated for change in resident home state, then the
40notice is required to include both the previous and current address.

P51   1
(4) Maintaining a resident independent insurance adjuster
2license is required for the nonresident independent insurance
3adjuster license to remain valid.

4
(d) This section shall become operative on January 1, 2018.

end insert
5begin insert

begin insertSEC. 53.end insert  

end insert

begin insertSection 14079 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
6read:end insert

begin insert
7

begin insert14079.end insert  

(a) An independent insurance adjuster shall be honest
8and fair in all communications with the insured, the insurer, and
9the public.

10
(b) An independent insurance adjuster shall provide
11policyholders and claimants with prompt and knowledgeable
12service and courteous, fair, and objective treatment at all times.

13
(c) An independent insurance adjuster shall not give legal advice
14and shall not deal directly with any policyholder or claimant who
15is represented by legal counsel without the consent of the legal
16counsel involved.

17
(d) An independent insurance adjuster shall comply with all
18local, state, and federal privacy and information security laws.

19
(e) An independent insurance adjuster shall identify himself or
20herself as an independent insurance adjuster and, if applicable,
21shall identify his or her employer when dealing with any
22policyholder or claimant.

23
(f) An independent insurance adjuster shall not have any
24financial interest in any adjustment or shall not acquire for himself,
25herself, or any person any interest or title in salvage, without first
26receiving written authority from the principal.

27
(g) This section shall become operative on January 1, 2018.

end insert
28begin insert

begin insertSEC. 54.end insert  

end insert

begin insertSection 14080 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
29read:end insert

30

14080.  

begin insert(a)end insertbegin insertend insertAny person who knowingly falsifies the fingerprints
31or photographs submitted underbegin insert paragraph (6) ofend insert subdivisionbegin delete (f)end delete
32begin insert (a)end insert of Section 14024 is guilty of a felony. Any person who violates
33any of the other provisions of this chapter is guilty of a
34misdemeanor punishable by fine not to exceed five hundred dollars
35($500), or by imprisonment in the county jail not to exceed one
36year, or by bothbegin delete suchend deletebegin insert theend insert fine and imprisonment.

begin insert

37
(b) This section shall remain in effect only until January 1, 2018,
38and as of that date is repealed, unless a later enacted statute, that
39is enacted before January 1, 2018, deletes or extends that date.

end insert
P52   1begin insert

begin insertSEC. 55.end insert  

end insert

begin insertSection 14080 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
2read:end insert

begin insert
3

begin insert14080.end insert  

(a) Any person who knowingly falsifies the fingerprints
4or photographs submitted under paragraph (7) of subdivision (a)
5of Section 14024 or paragraph (7) of subdivision (c) of Section
614025.1 is guilty of a felony. Any person who violates any of the
7other provisions of this chapter is guilty of a misdemeanor
8punishable by fine not to exceed five hundred dollars ($500), or
9by imprisonment in the county jail not to exceed one year, or by
10both the fine and imprisonment.

11
(b) This section shall become operative on January 1, 2018.

end insert
12begin insert

begin insertSEC. 56.end insert  

end insert

begin insertSection 14090.1 of the end insertbegin insertInsurance Codeend insertbegin insert is amended
13to read:end insert

14

14090.1.  

(a) An individual who holds an insurance adjuster
15license and who is not exempt under subdivision (b) shall
16satisfactorily complete a minimum of 24 hours, of which three
17hours are to be in ethics, of continuing education courses pertinent
18to the duties and responsibilities of an insurance adjuster license
19reported to the insurance commissioner on a biennial basis in
20conjunction with his or her license renewal cycle.

21(b) This section does not apply to any of the following:

22(1) A licensee not licensed for one full year prior to the end of
23the applicable continuing education biennium.

24(2) A licensee holding a nonresident insurance adjuster license
25who has met the continuing education requirements of his or her
26designated resident state.

27(3) An individual licensed as an insurance adjuster and as a
28property or casualty broker-agent, pursuant to Section 1625, who
29has met the continuing education requirements specified in Section
301749.3.

begin insert

31
(c) This section shall remain in effect only until January 1, 2018,
32and as of that date is repealed, unless a later enacted statute, that
33is enacted before January 1, 2018, deletes or extends that date.

end insert
34begin insert

begin insertSEC. 57.end insert  

end insert

begin insertSection 14090.1 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
35read:end insert

begin insert
36

begin insert14090.1.end insert  

(a) An individual who holds an independent insurance
37adjuster license and who is not exempt under subdivision (b) shall
38satisfactorily complete a minimum of 24 hours, of which three
39hours are to be in ethics, of continuing education courses pertinent
40to the duties and responsibilities of an independent insurance
P53   1adjuster license and shall report the completion of this coursework
2to the insurance commissioner on a biennial basis in conjunction
3with his or her license renewal cycle.

4
(b) This section does not apply to any of the following:

5
(1) A licensee not licensed for one full year prior to the end of
6the applicable continuing education biennium.

7
(2) A licensee holding a nonresident independent insurance
8adjuster license who has met the continuing education requirements
9of his or her designated home state.

10
(3) An individual licensed as an independent insurance adjuster
11and as a property or casualty broker-agent, pursuant to Section
121625, who has met the continuing education requirements specified
13in Section 1749.3.

14
(4) An individual licensed as an apprentice independent
15insurance adjuster pursuant to Section 14025.1.

16
(c) This section shall become operative on January 1, 2018.

end insert
17begin insert

begin insertSEC. 58.end insert  

end insert

begin insertSection 14097 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
18read:end insert

19

14097.  

begin insert(a)end insertbegin insertend insertThe amount of fees prescribed by this chapter,
20unless otherwise fixed, is that fixed in the following schedule:

begin delete

21(a)

end delete

22begin insert(1)end insert The application fee for an original license is twenty-nine
23dollars ($29).

begin delete

24(b)

end delete

25begin insert(2)end insert The application fee for an original branch office certificate
26is eighteen dollars ($18).

begin delete

27(c)

end delete

28begin insert(3)end insert The fee for an original license is an amount equal to the
29renewal fee in effect on the last regular renewal date before the
30date on which the license is issued, except that, if the license will
31expire less than one year after its issuance, then the fee is an
32amount equal to 50 percent of the renewal fee in effect on the last
33regular renewal date before the date on which the license is issued.
34The commissioner may, by appropriate regulation, provide for the
35waiver or refund of the initial license fee where the license is issued
36less than 45 days before the date on which it will expire.

begin delete

37(d)

end delete

38begin insert(4)end insert The renewal fee shall be fixed by the commissioner as
39follows:

begin delete

40(1)

end delete

P54   1begin insert(A)end insert For a license as an insurance adjuster, not more than one
2hundred eighteen dollars ($118).

begin delete

3(2)

end delete

4begin insert(B)end insert For a branch office certificate, not more than twenty-four
5dollars ($24).

begin delete

6(e)

end delete

7begin insert(5)end insert The application and license fee for classifications prescribed
8by the commissioner, in addition to those provided for in this
9chapter, and the application and license fees for a change in the
10type of business organization of a licensee, shall be in the amount
11prescribed by rule and regulation of the commissioner.

begin delete

12(f)

end delete

13begin insert(6)end insert The delinquency fee shall be 50 percent of the renewal fee
14in effect on the date of expiration, but not more than twenty-nine
15dollars ($29).

begin delete

16(g)

end delete

17begin insert(7)end insert The fee for reexamination of an applicant or his manager is
18twelve dollars ($12).

begin insert

19
(b) This section shall remain in effect only until January 1, 2018,
20and as of that date is repealed, unless a later enacted statute, that
21is enacted before January 1, 2018, deletes or extends that date.

end insert
22begin insert

begin insertSEC. 59.end insert  

end insert

begin insertSection 14097 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
23read:end insert

begin insert
24

begin insert14097.end insert  

(a) The amount of fees prescribed by this chapter,
25unless otherwise fixed, is that fixed in the following schedule:

26
(1) The application fee for the qualifying examination for an
27original license is seventy-two dollars ($72).

28
(2) The application fee for an original branch office certificate
29is forty-seven dollars ($47).

30
(3) The fee for an original license application is up to one
31hundred seventy dollars ($170). If the license will expire less than
32one year after its issuance, then the fee is an amount equal to 50
33percent of the renewal fee in effect on the last regular renewal
34date before the date on which the license is issued. The
35commissioner may, by appropriate regulation, provide for the
36waiver or refund of the initial license fee where the license is issued
37less than 45 days before the date on which it will expire.

38
(4) The renewal fee shall be fixed by the commissioner as
39follows:

P55   1
(A) For a license as an independent insurance adjuster, not
2more than one hundred seventy dollars ($170).

3
(B) For a branch office certificate, not more than fifty-six dollars
4($56).

5
(5) The application and license fee for classifications prescribed
6by the commissioner, in addition to those provided for in this
7chapter, and the application and license fees for a change in the
8type of business organization of a licensee, shall be in the amount
9prescribed by rule and regulation of the commissioner.

10
(6) The delinquency fee shall be 50 percent of the renewal fee
11in effect on the date of expiration.

12
(7) The fee for reexamination of an applicant is twenty-nine
13dollars ($29).

14
(8) The application fee for an apprentice independent insurance
15adjuster license shall be fixed at up to one hundred seventy dollars
16($170).

17
(b) This section shall become operative on January 1, 2018.

end insert
18begin insert

begin insertSEC. 60.end insert  

end insert

begin insertSection 14099 of the end insertbegin insertInsurance Codeend insertbegin insert is amended to
19read:end insert

20

14099.  

begin insert(a)end insertbegin insertend insertApplication or licensebegin delete feeend deletebegin insert feesend insert shall not be refunded
21except in accordance with Section 158 of the Business and
22Professions Code.

begin insert

23
(b) This section shall remain in effect only until January 1, 2018,
24and as of that date is repealed, unless a later enacted statute, that
25is enacted before January 1, 2018, deletes or extends that date.

end insert
26begin insert

begin insertSEC. 61.end insert  

end insert

begin insertSection 14099 is added to the end insertbegin insertInsurance Codeend insertbegin insert, to
27read:end insert

begin insert
28

begin insert14099.end insert  

(a) Application or license fees shall not be refunded
29pursuant to Section 1751.5.

30
(b) This section shall become operative on January 1, 2018.

end insert
31begin insert

begin insertSEC. 62.end insert  

end insert
begin insert

No reimbursement is required by this act pursuant
32to Section 6 of Article XIII B of the California Constitution because
33the only costs that may be incurred by a local agency or school
34district will be incurred because this act creates a new crime or
35infraction, eliminates a crime or infraction, or changes the penalty
36for a crime or infraction, within the meaning of Section 17556 of
37the Government Code, or changes the definition of a crime within
P56   1the meaning of Section 6 of Article XIII B of the California
2Constitution.

end insert


O

    97