AB 2591, as amended, Dababneh. Insurance: electronic transmission.
Existing law generally requires, with exceptions, that specified provisions of the Civil Code apply to electronic records and electronic signatures relating to a transaction.
This bill would remove various notices, including a policy cancellation notice by the named insured and a written notice of nonrenewal of the policy from the above exemptions, making those notices subject to the specified provisions of the Civil Code. The bill, commencing January 1, 2021, would reinstate certain exemptions of those notices from the specified provisions of the Civil Code.
Existing law generally requires that any required notice related to insurance transactions be made by mail. Existing law authorizes an insurer, under specified conditions, to provide by electronic transmission the required offer of renewal for automobile insurance, the required notice of conditional renewal for commercial insurance, the required offer of coverage or renewal or any disclosure required regarding earthquake insurance, and the offer of renewal for a workers’ compensation policy.
The bill would, until January 1, 2021, for the above-specified records, authorize persons in addition to the insurer to send those records by electronic transmission by providing that an agent, broker, or any other person licensed by the Department of Insurance may send those records electronically, as specified. The bill, as of January 1, 2021, would no longer authorize the notice of conditional renewal for commercial insurance to be sent electronically.
Existing law prohibits an insurer, relating to any insurance on risks or on operations in this state, including reinsurance, life insurance, insurance of vessels or craft, title insurance, and disability insurance, from sending a written notice by electronic transmission.
This bill would repeal the above prohibition, thereby allowing an insurer, relating to any insurance on risks or on operations in this state, including reinsurance, life insurance, insurance of vessels or craft, title insurance, and disability insurance, to send a written notice by electronic transmission.
Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 1633.3 of the Civil Code, as amended
2by Section 1.5 of Chapter 638 of the Statutes of 2015, is repealed.
Section 1633.3 of the Civil Code, as amended by
4Section 2.5 of Chapter 638 of the Statutes of 2015, is amended to
5read:
(a) Except as otherwise provided in subdivisions (b)
7and (c), this title applies to electronic records and electronic
8signatures relating to a transaction.
P3 1(b) This title does not apply to transactions subject to the
2following laws:
3(1) A law governing the creation and execution of wills, codicils,
4or testamentary trusts.
5(2) Division 1 (commencing with Section 1101) of the Uniform
6Commercial Code, except Sections 1206 and 1306.
7(3) Divisions 3 (commencing with Section 3101), 4
8(commencing with
Section 4101), 5 (commencing with Section
95101), 8 (commencing with Section 8101), 9 (commencing with
10Section 9101), and 11 (commencing with Section 11101) of the
11Uniform Commercial Code.
12(4) A law that requires that specifically identifiable text or
13disclosures in a record or a portion of a record be separately signed,
14including initialed, from the record. However, this paragraph does
15not apply to Section 1677 or 1678 of this code or Section 1298 of
16the Code of Civil Procedure.
17(c) This title does not apply to any specific transaction described
18in Section 17511.5 of the Business and Professions Code, Section
1956.11, 56.17, 798.14, 1133, or 1134 of, Section 1689.6, 1689.7,
20or 1689.13 of, Chapter 2.5 (commencing with Section 1695) of
21Title 5 of Part 2 of Division 3 of, Section
1720, 1785.15, 1789.14,
221789.16, or 1793.23 of, Chapter 1 (commencing with Section
231801) of Title 2 of Part 4 of Division 3 of, Section 1861.24, 1862.5,
241917.712, 1917.713, 1950.6, 1983, 2924b, 2924c, 2924f, 2924i,
252924j, 2924.3, or 2937 of, Article 1.5 (commencing with Section
262945) of Chapter 2 of Title 14 of Part 4 of Division 3 of, Section
272954.5 or 2963 of, Chapter 2b (commencing with Section 2981)
28or 2d (commencing with Section 2985.7) of Title 14 of Part 4 of
29Division 3 of, Section 3071.5 of Part 5 (commencing with Section
304000) of Division 4 of, or Part 5.3 (commencing with Section
316500) of Division 4 of this code, subdivision (b) of Section 18608
32or Section 22328 of the Financial Code, Section 1358.15, 1365,
331368.01, 1368.1, 1371, or 18035.5 of the Health and Safety Code,
34Section 786 as it applies to individual and group disability policies,
3510192.18, 10199.44, 10199.46, 10235.16, 10235.40,
11624.09, or
3611624.1 of the Insurance Code, Section 779.1, 10010.1, or 16482
37of the Public Utilities Code, or Section 9975 or 11738 of the
38Vehicle Code. An electronic record may not be substituted for any
39notice that is required to be sent pursuant to Section 1162 of the
40Code of Civil Procedure. Nothing in this subdivision shall be
P4 1construed to prohibit the recordation of any document with a county
2recorder by electronic means.
3(d) This title applies to an electronic record or electronic
4signature otherwise excluded from the application of this title under
5subdivision (b) when used for a transaction subject to a law other
6than those specified in subdivision (b).
7(e) A transaction subject to this title is also subject to other
8applicable substantive law.
9(f) The exclusion of a transaction from the application of this
10title under subdivision (b) or (c) shall be construed only to exclude
11the transaction from the application of this title, but shall not be
12construed to prohibit the transaction from being conducted by
13electronic means if the transaction may be conducted by electronic
14means under any other applicable law.
15(g) Notwithstanding subdivisions (b) and (c), this title shall
16apply to electronic records and electronic signatures relating to
17transactions conducted by a person licensed, certified, or registered
18pursuant to the Alarm Company Act (Chapter 11.6 (commencing
19with Section 7590) of Division 3 of the Business and Professions
20Code) for purposes of activities authorized by Section 7599.54 of
21the Business and Professions
Code.
22(h) This section shall remain in effect only until January 1, 2021,
23and as of that date is repealed, unless a later enacted statute, that
24is enacted before January 1, 2021, deletes or extends that date.
Section 1633.3 of the Civil Code, as added by Section
263.5 of Chapter 638 of the Statutes of 2015, is amended to read:
(a) Except as otherwise provided in subdivisions (b)
28and (c), this title applies to electronic records and electronic
29signatures relating to a transaction.
30(b) This title does not apply to transactions subject to the
31following laws:
32(1) A law governing the creation and execution of wills, codicils,
33or testamentary trusts.
34(2) Division 1 (commencing with Section 1101) of the Uniform
35Commercial Code, except Sections 1206 and 1306.
36(3) Divisions 3 (commencing with Section 3101), 4
37(commencing with Section 4101), 5 (commencing with Section
385101), 8 (commencing with Section 8101), 9 (commencing with
39Section 9101), and 11 (commencing with Section 11101) of the
40Uniform Commercial Code.
P5 1(4) A law that requires that specifically identifiable text or
2disclosures in a record or a portion of a record be separately signed,
3including initialed, from the record.
However, this paragraph does
4not apply to Section 1677 or 1678 of this code or Section 1298 of
5the Code of Civil Procedure.
6(c) This title does not apply to any specific transaction described
7in Section 17511.5 of the Business and Professions Code, Section
856.11, 56.17, 798.14, 1133, or 1134 of, Section 1689.6, 1689.7,
9or 1689.13 of, Chapter 2.5 (commencing with Section 1695) of
10Title 5 of Part 2 of Division 3 of, Section 1720, 1785.15, 1789.14,
111789.16, or 1793.23 of, Chapter 1 (commencing with Section
121801) of Title 2 of Part 4 of Division 3 of, Section 1861.24, 1862.5,
131917.712, 1917.713, 1950.6, 1983, 2924b, 2924c, 2924f, 2924i,
142924j, 2924.3, or 2937 of, Article 1.5 (commencing with Section
152945) of Chapter 2 of Title 14 of Part 4 of
Division 3 of, Section
162954.5 or 2963 of, Chapter 2b (commencing with Section 2981)
17or 2d (commencing with Section 2985.7) of Title 14 of Part 4 of
18Division 3 of, Section 3071.5 of Part 5 (commencing with Section
194000) of Division 4 of, or Part 5.3 (commencing with Section
206500) of Division 4 of this code, subdivision (b) of Section 18608
21or Section 22328 of the Financial Code, Section 1358.15, 1365,
221368.01, 1368.1, 1371, or 18035.5 of the Health and Safety Code,
23Section 662, paragraph (2) of subdivision (a) of Section 663, 664,
24673, 677, 678.1, 786, paragraph (2) of subdivision (a) of Section
2510086, 10192.18, 10199.44, 10199.46, 10235.16, 10235.40,
26
11624.09, or 11624.1 of the Insurance Code, Section 779.1,
2710010.1, or 16482 of the Public Utilities Code, or Section 9975
28or 11738 of the Vehicle Code. An electronic record may not be
29substituted for any notice that is required to be sent pursuant to
30Section 1162 of the Code of Civil Procedure. Nothing in this
31subdivision shall be construed to prohibit the recordation of any
32document with a county recorder by electronic means.
33(d) This title applies to an electronic record or electronic
34signature otherwise excluded from the application of this title under
35subdivision (b) when used for a transaction subject to a law other
36than those specified in subdivision (b).
37(e) A transaction subject to this title is also subject to other
38applicable substantive law.
39(f) The exclusion of a transaction from the application of this
40title under subdivision (b) or (c) shall be construed only to exclude
P6 1the transaction from the application of this title, but shall not be
2construed to prohibit the transaction from being conducted by
3electronic means if the transaction may be conducted by electronic
4means under any other applicable law.
5(g) Notwithstanding subdivisions (b) and (c), this title shall
6apply to
electronic records and electronic signatures relating to
7transactions conducted by a person licensed, certified, or registered
8
pursuant to the Alarm Company Act (Chapter 11.6 (commencing
9with Section 7590) of Division 3 of the Business and Professions
10Code) for purposes of activities authorized by Section 7599.54 of
11the Business and Professions Code.
12(h) This section shall become operative on January 1, 2021.
Section 38.5 of the Insurance Code, as amended by
14Section 4 of Chapter 369 of the Statutes of 2013, is repealed.
Section 38.5 of the Insurance Code, as added by
16Section 5 of Chapter 369 of the Statutes of 2013, is repealed.
Section 38.6 of the Insurance Code is amended to read:
(a) (1) Any written record required to be given or mailed
19to any person by a licensee, including an offer of renewal required
20by Sections 663 and 678, the notice of policy change or
21cancellation requested by the insured as required by Section 667.5,
22the notice of conditional renewal required by Section 678.1, the
23offer of coverage or renewal or any disclosure required by Section
2410086, the offer of renewal for a workers’ compensation policy,
25Section 662, paragraph (2) of subdivision (a) of Section 663,
26Section 664, 667.5, 673, 677, paragraph (2) of subdivision (a) of
27Section 678, subdivisions (a) and (b) of Section 678.1, or any
28written record required to be given or mailed to any person by a
29licensee relating to the business of
life insurance, as defined in
30Section 101 of this code may, if not excluded by subdivision (b)
31or (c) of Section 1633.3 of the Civil Code, be provided by
32electronic transmission pursuant to Title 2.5 (commencing with
33Section 1633.1) of Part 2 of Division 3 of the Civil Code, if each
34party has agreed to conduct the transaction by electronic means
35pursuant to Section 1633.5 of the Civil Code, and if the licensee
36complies with the provisions of this section. A valid electronic
37signature shall be sufficient for any provision of law requiring a
38written signature.
39(2) For purposes of this section, the definitions set forth in
40Section 1633.2 of the Civil Code shall apply. The term “licensee”
P7 1means an insurer, agent, broker, or any other person who is required
2to be licensed by the department.
3(3) Notwithstanding subdivision (l) of Section 1633.2 of the
4Civil Code, for purposes of this section, “person” includes, but is
5not limited to, the policy owner, policyholder, applicant, insured,
6or assignee or designee of an insured.
7(b) In order to transmit a record listed in subdivision (a)
8electronically, a licensee shall comply with all of the following:
9(1) A licensee, or licensee’s representative, acquires the consent
10of the person to opt in to receive the record by electronic
11transmission, and the person has not withdrawn that consent, prior
12to providing the record by electronic transmission. A person’s
13consent may be acquired verbally, in writing, or electronically. If
14consent is acquired verbally, the licensee shall confirm consent in
15writing or
electronically. The licensee shall retain a record of the
16person’s consent to receive the record by electronic transmission
17with the policy information so that it is retrievable upon request
18by the department while the policy is in force and for five years
19thereafter.
20(2) A licensee discloses, in writing or electronically, to the
21person all of the following:
22(A) The opt in to receive the record by electronic transmission
23is voluntary.
24(B) That the person may opt out of receiving the record by
25electronic transmission at any time, and the process or system for
26the person to opt out.
27(C) A description of the record that the person will receive by
28electronic
transmission.
29(D) The process or system to report a change or correction in
30the person’s email address.
31(E) The licensee’s contact information, which includes, but is
32not limited to, a toll-free number or the licensee’s Internet Web
33site address.
34(3) The opt-in consent disclosure required by paragraph (2) may
35be set forth in the application or in a separate document that is part
36of the policy approved by the commissioner and shall be bolded
37or otherwise set forth in a conspicuous manner. The person’s
38signature shall be set forth immediately below the opt-in consent
39disclosure. If the licensee seeks consent at any time prior to the
40completion of the application, consent and signature shall be
P8 1obtained before the
application is completed. If the person has not
2opted in at the time the application is completed, the licensee may
3receive the opt-in consent at any time thereafter, pursuant to the
4same opt-in requirements that apply at the time of the application.
5The licensee shall retain a copy of the signed opt-in consent
6disclosure with the policy information so that each is retrievable
7upon request by the department while the policy is in force and
8for five years thereafter.
9(4) The email address of the person who has consented to
10electronic transmission shall be set forth on the consent disclosure.
11In addition, if the person who consented receives an annual
12statement, the email address of the person who has consented shall
13be set forth on that record.
14(5) The licensee shall
annually provide one free printed copy
15of any record described in this subdivision upon request by the
16person.
17(6) If a provision of this code requires a licensee to transmit a
18record by first-class mail, regular mail, does not specify a method
19of delivery, or is a record that is required to be provided pursuant
20to Article 6.6 (commencing with Section 791), and if the licensee
21is not otherwise prohibited from transmitting the record
22electronically under subdivision (b) of Section 1633.8 of the Civil
23Code, then the record may be transmitted by electronic transmission
24if the licensee complies with all of the requirements of Sections
251633.15 and 1633.16 of the Civil Code.
26(7) Notwithstanding subdivision (b) of Section 1633.8 of the
27Civil Code, if a provision of this code requires a
licensee to
28
transmit a record by return receipt, registered mail, certified mail,
29signed written receipt of delivery, or other method of delivery
30evidencing actual receipt by the person, and if the licensee is not
31otherwise prohibited from transmitting the record electronically
32under Section 1633.3 of the Civil Code and the provisions of this
33section, then the licensee shall maintain a process or system that
34demonstrates proof of delivery and actual receipt of the record by
35the person consistent with this paragraph. The licensee shall
36document and retain information demonstrating delivery and actual
37receipt so that it is retrievable, upon request, by the department at
38least five years after the policy is no longer in force. The record
39provided by electronic transmission shall be treated as if actually
40received if the licensee delivers the record to the person in
P9 1compliance with applicable statutory
delivery deadlines. A licensee
2may demonstrate actual delivery and receipt by any of the
3following:
4(A) The person acknowledges receipt of the electronic
5transmission of the record by executing an electronic signature.
6(B) The record is posted on the licensee’s secure Internet Web
7site, and there is evidence demonstrating that the person logged
8onto the licensee’s secure Internet Web site and downloaded,
9printed, or otherwise acknowledged receipt of the record.
10
(C) The record is transmitted to the named insured through an
11application on a personal electronic device that is secured by
12password, biometric identifier, or other technology, and there is
13evidence demonstrating
that the person logged into the application
14and viewed or otherwise acknowledged receipt of the record.
15(C)
end delete
16begin insert(D)end insert If a licensee is unable to demonstrate actual delivery and
17receipt pursuant to this paragraph, the licensee shall resend the
18record by regular mail to the person in the manner originally
19specified by the underlying provision of this code.
20(8) Notwithstanding any other law, a notice of lapse,
21nonrenewal, cancellation, or termination of any product subject to
22this section may be transmitted electronically if the
licensee
23demonstrates proof of delivery as set forth in paragraph (7) and
24complies with the other provisions in this section.
25(9) If the record is not delivered directly to the electronic address
26designated by the person but placed at an electronic address
27accessible to the person, a licensee shall notify the person in plain,
28clear, and conspicuous language at the electronic address
29designated by the person that describes the record, informs that
30person that it is available at another location, and provides
31instructions to the person as to how to obtain the record.
32(10) (A) Upon a licensee receiving information indicating that
33the record sent by electronic transmission was not received by the
34person, the licensee shall, within five business days, comply with
35either
clause (i) or (ii):
36(i) Contact the person to confirm or update the person’s email
37address and resend the record by electronic transmission. If the
38licensee elects to resend the record by electronic transmission, the
39licensee shall demonstrate the transmission was received by the
40person, pursuant to paragraph (6), (7), or (8). If the licensee is
P10 1unable to confirm or update the person’s email address, the licensee
2shall resend the record by regular mail to the licensee at the address
3shown on the policy, or, if the underlying statute requires delivery
4in a specified manner, send the record in that specified manner.
5(ii) Resend the record initially provided by electronic
6transmission by regular mail to the insured at the address shown
7on the policy, or, if the underlying statute requires
delivery in a
8specified manner, send the record in that specified manner.
9(B) If the licensee sends the first electronic record within the
10time period required by law and the licensee complies with both
11paragraph (5) and subparagraph (A) of this paragraph, the record
12sent pursuant to clause (i) or (ii) of subparagraph (A) shall be
13treated as if mailed in compliance with the applicable statutory
14regular mail delivery deadlines.
15(11) The licensee shall not charge any person who declines to
16opt in to receive a record through electronic transmission from
17receiving a record electronically. The licensee shall not provide a
18discount or an incentive to any person to opt in to receive electronic
19records.
20(12) The
licensee shall verify a person’s email address via paper
21writing sent by regular mail when more than 12 months have
22elapsed since the licensee’s last electronic communication.
23(c) An insurance agent or broker acting under the direction of
24a party that enters into a contract by means of an electronic record
25or electronic signature shall not be held liable for any deficiency
26in the electronic procedures agreed to by the parties under that
27contract if all of the following are met:
28(1) The insurance agent or broker has not engaged in negligent,
29reckless, or intentional tortious conduct.
30(2) The insurance agent or broker was not involved in the
31development or establishment of the electronic procedures.
32(3) The insurance agent or broker did not deviate from the
33electronic procedures.
34(d) (1) On or before January 1, 2019, the commissioner shall
35submit a report to the Governor and to the committees of the Senate
36and Assembly having jurisdiction over insurance and the judiciary,
37regarding the impact and implementation of the authorization of
38the electronic transmission of certain insurance renewal offers,
39notices, or disclosures, relating to the business of life insurance,
40as authorized by this section. The report shall include input from
P11 1insurers, consumers, and consumer organizations, and shall include
2an assessment of the department’s experience pertaining to the
3authorization of the electronic transmission of insurance renewals,
4relating to the business of
life insurance, as authorized by this
5section.
6(2) On or before January 1, 2019, the commissioner shall submit
7a report to the Governor and to the committees of the Senate and
8Assembly having jurisdiction over insurance and the judiciary,
9regarding the impact and implementation of the authorization of
10the electronic transmission of certain insurance renewal offers,
11notices, or disclosures including an offer of renewal required by
12Sections 663 and 678, the notice of conditional renewal required
13by Section 678.1, the offer of coverage or renewal or any disclosure
14required by Section 10086, and the offer of renewal for a workers’
15compensation policy, as authorized by this section. The report
16shall include input from insurers, consumers, and consumer
17organizations, and shall include an assessment of the department’s
18experience
pertaining to the authorization of the electronic
19transmission of insurance renewals, including, an offer of renewal
20
required by Sections 663 and 678, the notice of conditional renewal
21required by Section 678.1, the offer of coverage or renewal or any
22disclosure required by Section 10086, and the offer of renewal for
23a workers’ compensation policy, as authorized by this section.
24(e) Notwithstanding paragraph (4) of subdivision (b) of Section
251633.3 of the Civil Code, for any policy of life insurance, as
26defined in Section 101, any statutory requirement for a separate
27acknowledgment, signature, or initial, which is not expressly
28prohibited by subdivision (c) of Section 1633.3 of the Civil Code,
29may be transacted using an electronic signature, or by electronic
30transaction, subject to all applicable provisions of this section.
31(f) The department may suspend a licensee from providing
32records
by electronic transmission if there is a pattern or practices
33that demonstrate the licensee has failed to comply with the
34requirements of this section. A licensee may appeal the suspension
35and resume its electronic transmission of records upon
36communication from the department that the changes the licensee
37made to its process or system to comply with the requirements of
38this section are satisfactory.
P12 1(g) This section shall remain in effect only until January 1, 2021,
2and as of that date is repealed, unless a later enacted statute, that
3is enacted before January 1, 2021, deletes or extends that date.
Section 38.6 is added to the Insurance Code, to read:
(a) (1) Any written record required to be given or mailed
6to any person by a licensee, including an offer of renewal required
7by paragraph (1) of subdivision (a) of Section 663 and Section
8678, the notice of policy change or cancellation requested by the
9insured as required by Section 667.5, the offer of coverage or
10renewal or any disclosure required by
paragraph (1) of subdivision
11(a) of Section 10086, the offer of renewal for a workers’
12compensation policy, or any written record required to be given
13or mailed to any person by a licensee relating to the business of
14life insurance, as defined in Section 101 of this code may, if not
15excluded by subdivision (b) or (c) of Section 1633.3 of the Civil
16Code, be provided by electronic transmission pursuant to Title 2.5
17(commencing with Section 1633.1) of Part 2 of Division 3 of the
18Civil Code, if each party has agreed to conduct the transaction by
19electronic means pursuant to Section 1633.5 of the Civil Code,
20and if the licensee complies with the provisions of this section. A
21valid electronic signature shall be sufficient for any provision of
22law requiring a written signature.
23(2) For purposes of this section, the definitions set forth
in
24Section 1633.2 of the Civil Code shall apply. The term “licensee”
25means an insurer, agent, broker, or any other person who is required
26to be licensed by the department.
27(3) Notwithstanding subdivision (l) of Section 1633.2 of the
28Civil Code, for purposes of this section, “person” includes, but is
29not limited to, the policy owner, policyholder, applicant, insured,
30or assignee or designee of an insured.
31(b) In order to transmit a record listed in subdivision (a)
32electronically, a licensee shall comply with all of the following:
33(1) A licensee, or licensee’s representative, acquires the consent
34of the person to opt in to receive the record by electronic
35transmission, and the person has not withdrawn that consent, prior
36to
providing the record by electronic transmission. A person’s
37consent may be acquired verbally, in writing, or electronically. If
38consent is acquired verbally, the licensee shall confirm consent in
39writing or electronically. The licensee shall retain a record of the
40person’s consent to receive the record by electronic transmission
P13 1with the policy information so that it is retrievable upon request
2by the department while the policy is in force and for five years
3thereafter.
4(2) A licensee discloses, in writing or electronically, to the
5person all of the following:
6(A) The opt in to receive the record by electronic transmission
7is voluntary.
8(B) That the person may opt out of receiving the record by
9electronic
transmission at any time, and the process or system for
10the person to opt out.
11(C) A description of the record that the person will receive by
12electronic transmission.
13(D) The process or system to report a change or correction in
14the person’s email address.
15(E) The licensee’s contact information, which includes, but is
16not limited to, a toll-free number or the licensee’s Internet Web
17site address.
18(3) The opt-in consent disclosure required by paragraph (2) may
19be set forth in the application or in a separate document that is part
20of the policy approved by the commissioner and shall be bolded
21or otherwise set forth in a conspicuous manner. The person’s
22signature
shall be set forth immediately below the opt-in consent
23disclosure. If the licensee seeks consent at any time prior to the
24completion of the application, consent and signature shall be
25obtained before the application is completed. If the person has not
26opted in at the time the application is completed, the licensee may
27receive the opt-in consent at any time thereafter, pursuant to the
28same opt-in requirements that apply at the time of the application.
29The licensee shall retain a copy of the signed opt-in consent
30disclosure with the policy information so that each is retrievable
31upon request by the department while the policy is in force and
32for five years thereafter.
33(4) The email address of the person who has consented to
34electronic transmission shall be set forth on the consent disclosure.
35In addition, if the person who consented receives an
annual
36statement, the email address of the person who has consented shall
37be set forth on that record.
38(5) The licensee shall annually provide one free printed copy
39of any record described in this subdivision upon request by the
40person.
P14 1(6) If a provision of this code requires a licensee to transmit a
2record by first-class mail, regular mail, does not specify a method
3of delivery, or is a record that is required to be provided pursuant
4to Article 6.6 (commencing with Section 791), and if the licensee
5is not otherwise prohibited from transmitting the record
6electronically under subdivision (b) of Section 1633.8 of the Civil
7Code, then the record may be transmitted by electronic transmission
8if the licensee complies with all of the requirements of Sections
91633.15 and
1633.16 of the Civil Code.
10(7) If the record is not delivered directly to the electronic address
11designated by the person but placed at an electronic address
12accessible to the person, a licensee shall notify the person in plain,
13clear, and conspicuous language at the electronic address
14designated by the person that describes the record, informs that
15person that it is available at another location, and provides
16instructions to the person as to how to obtain the record.
17(8) (A) Upon a licensee receiving information indicating that
18the record sent by electronic transmission was not received by the
19person, the licensee shall, within five business days, comply with
20either clause (i) or (ii):
21(i) Contact
the person to confirm or update the person’s email
22address and resend the record by electronic transmission. If the
23licensee elects to resend the record by electronic transmission, the
24licensee shall demonstrate the transmission was received by the
25person, pursuant to paragraph (6). If the licensee is unable to
26confirm or update the person’s email address, the licensee shall
27resend the record by regular mail to the licensee at the address
28shown on the policy, or, if the underlying statute requires delivery
29in a specified manner, send the record in that specified manner.
30(ii) Resend the record initially provided by electronic
31transmission by regular mail to the insured at the address shown
32on the policy, or, if the underlying statute requires delivery in a
33specified manner, send the record in that specified manner.
34(B) If the licensee sends the first electronic record within the
35time period required by law and the licensee complies with both
36paragraph (5) and subparagraph (A) of this paragraph, the record
37sent pursuant to clause (i) or (ii) of subparagraph (A) shall be
38treated as if mailed in compliance with the applicable statutory
39regular mail delivery deadlines.
P15 1(9) The licensee shall not charge any person who declines to
2opt in to receive a record through electronic transmission from
3receiving a record electronically. The licensee shall not provide a
4discount or an incentive to any person to opt in to receive electronic
5records.
6(10) The licensee shall verify a person’s email address via paper
7writing sent by regular mail
when more than 12 months have
8elapsed since the licensee’s last electronic communication.
9(c) An insurance agent or broker acting under the direction of
10a party that enters into a contract by means of an electronic record
11or electronic signature shall not be held liable for any deficiency
12
in the electronic procedures agreed to by the parties under that
13contract if all of the following are met:
14(1) The insurance agent or broker has not engaged in negligent,
15reckless, or intentional tortious conduct.
16(2) The insurance agent or broker was not involved in the
17development or establishment of the electronic procedures.
18(3) The insurance agent or broker did not deviate from the
19electronic procedures.
20(d) Notwithstanding paragraph (4) of subdivision (b) of Section
211633.3 of the Civil Code, for any policy of life insurance, as
22defined in Section 101, any statutory requirement for a separate
23acknowledgment, signature, or initial, which is
not expressly
24prohibited by subdivision (c) of Section 1633.3 of the Civil Code,
25may be transacted using an electronic signature, or by electronic
26transaction, subject to all applicable provisions of this section.
27(e) The department may suspend a licensee from providing
28records by electronic transmission if there is a pattern or practices
29that demonstrate the licensee has failed to comply with the
30requirements of this section. A licensee may appeal the suspension
31and resume its electronic transmission of records upon
32communication from the department that the changes the licensee
33made to its process or system to comply with the requirements of
34this section are satisfactory.
35(f) This section shall become operative on January 1, 2021.
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