BILL NUMBER: SB 488 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Block
FEBRUARY 26, 2015
An act to amend Sections 1722, 1751.5, 14000, 14001, 14020, 14022,
14022.5, 14024, 14025, 14028, 14031, 14032, 14038, 14039, 14040,
14042, 14061, 14063, 14064, 14080, 14090.1, 14097, 14099, 15001,
15008, 15010, 15011, 15013, 15017, 15020, 15027, 15027.1, 15031,
15036, 15053, 15056, 15060, and 15062 of, to add Sections 14025.1,
14079, and 15009.1 to, to repeal Sections 14027, 14030, 14037, and
15015 of, and to repeal and add Sections 14010, 14021, 14026, 14029,
14078, 15007, and 15016 of, the Insurance Code, relating to
insurance.
LEGISLATIVE COUNSEL'S DIGEST
SB 488, as introduced, Block. Independent insurance adjusters:
public insurance adjusters.
(1) 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.
This bill 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 or self-insurers, a person whose tax
treatment by the insurers or self-insurers is consistent with that of
an independent contractor rather than as an employee, and a person
that investigates, negotiates, or settles property, casualty, or
workers' compensation claims for insurers or for self-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 performs
executive, administrative, managerial, or clerical duties or any
combination thereof, 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
fixed by the commissioner and reasonably related to the actual cost
to the department in performing its duties. 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.
(2) Existing law, the Public Insurance Adjusters Act, sets forth
various requirements with respect to operation as a public insurance
adjuster in this state, including, but not limited to, that the
person be licensed and licensing qualifications and application
requirements for public insurance adjusters, nonresident public
insurance adjusters, and interim public insurance adjusters. The act
defines the term "public insurance adjuster" to mean a person who,
for compensation, acts on behalf of, or aids in any manner, an
insured in negotiating for or effecting the settlement of a claim or
claims for loss or damage under any policy of insurance covering real
or personal property or any person who advertises, solicits
business, or holds himself or herself out to the public as an
adjuster of those claims and any person who, for compensation,
investigates, settles, adjusts, advises, or assists an insured with
reference to claims for those losses on behalf of any public
insurance adjuster. 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 public 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.
This bill would revise and recast the above provisions by, among
other things, redefining a "public insurance adjuster" to include any
person who, for compensation or any other thing of value on behalf
of an insured, acts or aids, solely in relation to first party claims
arising under insurance contracts that insure the real or personal
property of the insured, on behalf of an insured in negotiating for,
or effecting the settlement of, a claim for loss or damage coverage
by an insurance contract, or advertises for employment as a public
adjuster of insurance claims or solicits business or represents
himself or herself to the public as a public adjuster of first party
insurance claims for losses or damages arising out of policies of
insurance that insure real or personal property. The bill would
expand the categories of persons exempt from the act to include,
among others, a person who negotiates or settles claims arising under
a life or health insurance policy or an annuity contract and a
person who settles subrogation claims between insurers. The bill
would place additional eligibility requirements on applicants for a
nonresident license. The bill would also repeal the provisions
relating to an interim license, and would instead create an
apprentice public insurance adjuster license to facilitate the
training necessary to ensure reasonable competency in the
responsibilities and duties of a public insurance adjuster, and would
set forth the various terms and conditions of the license. The bill
would make an apprentice public 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. Because the bill would create a new crime, it would impose a
state-mandated local program.
(3) 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:
SECTION 1. Section 1722 of the Insurance Code is amended to read:
1722. If a natural person while licensed pursuant to the
provisions of this chapter or Chapters
Chapter 6 (commencing with Section 1760), 7 (commencing with
Section 1800), or 8 (commencing with Section 1831) of this part,
or Part 5 (commencing with Section 12140) of
Division 2 , or Chapter 1 (commencing with Section 14000) or 2
(commencing with Section 15000) of Division 5 enters the
military service of the United States and is in such
that service at a time prescribed for the filing
of a renewal application, the filing of such
that application is waived, and the license held by
such that licensee at the time of his or
her entry into military service shall remain in force during
the period of such that military
service and until the end of the license year in which he or she
is released from such that
service but not for less than six months after such
that release. During such
that period such , that
person may secure a license of the type held by him or her
on his or her entry into military service upon the filing
of an application and paying the fee therefor without the necessity
of taking any examination or paying any penalty.
SEC. 2. Section 1751.5 of the Insurance Code is amended to read:
1751.5. The fees required by this chapter and by Chapter 6
(commencing with Section 1760), Chapter 7 (commencing with Section
1800), and Chapter 8 (commencing with Section 1831) of this part
and by Chapter 1 (commencing with Section 14000) and
Chapter 2 (commencing with Section 15000) of Division 5 are
filing fees, no portion of which shall be refunded whether or not the
application is acted upon or the examination is taken.
SEC. 3. Section 14000 of the Insurance Code is amended to read:
14000. This chapter may be cited as the Independent
Insurance Adjuster Act.
SEC. 4. Section 14001 of the Insurance Code is amended to read:
14001. As used in this chapter , the following terms have
the following meanings :
(a) "Catastrophe" means an event that results in a large number of
deaths or injuries, causes extensive damage or destruction of
facilities that provide and sustain human needs, produces an
overwhelming demand on state and local response resources and
mechanisms, causes a severe long-term effect on general economic
activity, or severely affects state, local, and private sector
capabilities to begin and sustain response activities.
(a)
(b) "Commissioner" means the Insurance Commissioner.
(b)
(c) "Department" means the Department of Insurance.
(d) "Fingerprints" means an impression of the lines on the finger
taken for the purposes of identification.
(e) "Home state" means the District of Columbia and any state or
territory of the United States in which an independent insurance
adjuster maintains his, her, or its principal place of residence or
business and is licensed to act as a resident independent insurance
adjuster. If the resident state does not license independent
insurance adjusters, the independent insurance adjuster may designate
California as his, her, or its home state, provided that the
independent insurance adjuster is licensed and in good standing.
(f) "Individual" means a natural person.
(c)
(g) "Licensee" means a person licensed under this
chapter.
(d)
(h) "Manager" means the individual under whose
direction, control, charge, or management the business of a licensee
is operated.
(i) "Nonresident" means a person who is not a resident of
California at the time of the performance of the act referred to in
Section 14071.
(e)
(j) "Person" includes any individual, firm, company,
association, organization, partnership, limited liability company,
and corporation.
SEC. 5. Section 14010 of the Insurance Code is repealed.
14010. The department succeeds to and is vested with all the
duties, powers, purposes, responsibilities, and jurisdiction
previously vested in the Bureau of Collection and Investigative
Services with respect to the licensing of insurance adjusters.
Any reference to prior licensing shall be deemed to licensing
under the Private Investigator and Adjuster Act.
The commissioner shall administer and enforce the provisions of
this chapter.
SEC. 6. Section 14010 is added to the Insurance Code, to read:
14010. The commissioner shall administer and enforce the
provisions of this chapter.
SEC. 7. Section 14020 of the Insurance Code is amended to read:
14020. No person shall (a)
A person shall not engage in a business regulated by
this chapter, or act or assume to act as, or represent himself or
herself to be, a licensee unless he or she is licensed under
as an independent insurance adjuster in accordance
with this chapter.
No
(b) A person shall not
falsely represent that he or she is employed by a licensee.
SEC. 8. Section 14021 of the Insurance Code is repealed.
14021. An insurance adjuster within the meaning of this chapter
is a person other than a private investigator as defined in Section
7521 of the Business and Professions Code 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 or aids an insurer in any
manner with reference to:
Crime or wrongs done or threatened against the United States of
America or any state or territory of the United States of America;
the identity, habits, conduct, business, occupation, honesty,
integrity, credibility, knowledge, trustworthiness, efficiency,
loyalty, activity, movement, whereabouts, affiliations, associations,
transactions, acts, reputation, or character of any person; the
location, disposition, or recovery of lost or stolen property; the
cause or responsibility for fires, libels, losses, accidents, or
damage or injury to persons or to property; or securing evidence to
be used before any court, board, officer, or investigating committee.
Notwithstanding any other provision of law, this section is in no
way intended to limit the ability of a duly licensed independent
insurance adjuster to perform the duties of an independent insurance
adjuster for any other entity.
SEC. 9. Section 14021 is added to the Insurance Code, to read:
14021. An independent insurance adjuster, for purposes of this
chapter, is all of the following:
(a) An individual, a business entity, an independent contractor,
or an employee of a contractor, who contracts for compensation with
insurers or self-insurers.
(b) A person whose tax treatment by the insurers or self-insurers
is consistent with that of an independent contractor rather than an
employee, as defined in Section 3121 of Title 26 of the United States
Code.
(c) A person who investigates, negotiates, or settles property,
casualty, or workers' compensation claims for insurers or for
self-insurers.
SEC. 10. Section 14022 of the Insurance Code is amended to read:
14022. This chapter does not apply to any of the following
:
(a) A person employed exclusively and regularly by one employer in
connection with the affairs of such employer only and where there
exists an employer- employee relationship.
(b)
(a) An officer or employee of the United States of
America, or of this state or a political subdivision thereof, while
such that officer or employee is
engaged in the performance of his or her official duties.
(c)
(b) A person engaged exclusively in the business of
obtaining and furnishing information as to the financial rating of
persons.
(d)
(c) A charitable philanthropic society or association
duly incorporated under the laws of this state, which is organized
and maintained for the public good and not for private profit.
(e)
(d) An attorney at law in performing his or
her duties as such attorney at law. admitted to
practice in California, when acting in his or her professional
capacity as an attorney.
(f)
(e) A licensed collection agency or an employee thereof
while acting within the scope of his or her employment, while making
an investigation incidental to the business of the agency, including
an investigation of the location of a debtor or his or her property
where the contract with an assignor creditor is for the collection of
claims owed or due or asserted to be owed or due or the equivalent
thereof.
(g) Admitted insurers and agents and insurance brokers licensed by
the state, performing duties in connection with insurance transacted
by them.
(f) An officer, director, manager, or employee of an authorized
insurer, surplus line insurer, a risk retention group, or an
attorney-in-fact of a reciprocal insurer.
(g) A licensed insurance agent or broker, attorney-in-fact of a
reciprocal insurer, or managing general agent of the insurer to whom
claim authority has been granted by the insurer.
(h) The legal owner of personal property which
that has been sold under a conditional sales agreement or
a mortgagee under the terms of a chattel mortgage.
(i) Any bank subject to the jurisdiction of the Commissioner
of Financial Institutions of the State of California
of Business Oversight under Division 1
(commencing with Section 99) of the Financial Code or the Comptroller
of the Currency of the United States.
(j) A person engaged solely in the business of securing
information about persons or property from public records.
employed solely to obtain facts surrounding a claim or to
furnish technical assistance to a licensed independent insurance
adjuster.
(k) Any building contractor, engineer, technical expert, or other
person who is engaged by an insurer or licensed independent
insurance adjuster to provide an expert or professional
evaluation of the extent, cause, or origin of damage to the insured
property, but who does not otherwise participate in the process of
adjusting claims.
(l) An individual who is employed to investigate suspected
fraudulent insurance claims but who does not adjust losses or
determine claims payments.
(m) A person who solely performs executive, administrative,
managerial, or clerical duties or any combination thereof and who
does not investigate, negotiate, or settle claims with policyholders,
claimants, or their legal representative.
(n) A licensed health care provider or its employee who provides
managed care if the services do not include the determination of
compensability.
(o) A managed care organization or any of its employees who
provide managed care services if the services do not include the
determination of compensability.
(p) A person who settles only reinsurance or subrogation claims.
(q) A United States manager of the United States branch of an
alien insurer.
(r) A person who investigates, negotiates, or settles life,
accident and health, annuity, or disability insurance claims.
(s) An individual employee, under a self-insured arrangement, who
adjusts claims on behalf of his or her employer.
SEC. 11. Section 14022.5 of the Insurance Code is amended to read:
14022.5. (a) In the event of an emergency situation as declared
by the commissioner, claims arising out of the emergency,
catastrophe, disaster, or other similar occurrence may be adjusted by
a nonlicensed independent insurance adjuster upon
registration with the commissioner if all of the following
requirements are met:
(1) The work performed by the nonlicensed independent
insurance adjuster is under the active direction, control,
charge, or management of a licensed independent insurance
adjuster or an insurer authorized to do business in this state.
(2) Registration with the commissioner is accomplished within
15 five working days from the date on
which the nonlicensed independent insurance adjuster
commences the claims adjusting activity in connection with the
emergency situation.
(b) "Registration," within the meaning of this section,
shall mean means a written letter to the
commissioner, submitted by the supervising licensed independent
insurance adjuster or admitted insurer, naming the nonlicensed
independent insurance adjusters, identifying their
independent insurance adjuster licenses held in other
jurisdictions, and stating when their claims adjusting activity
commenced.
(c) Registration under this section is valid for a period of
180 90 days from the date of the
registration letter. Before the lapse of that period, the
commissioner may grant further 180-day 90-day
extensions as he or she deems appropriate upon written request
from the supervising licensed independent insurance
adjuster or the admitted insurer.
SEC. 12. Section 14024 of the Insurance Code is amended to read:
14024. An (a) An
individual application shall be verified and shall include
all of the following :
(a)
(1) The full legal name and
business address business, resident, and mailing
addresses of the applicant.
(b)
(2) The name under which the applicant
intends to do business.
(3) The applicant's birth date and social security number.
(4) The application fees set forth in Section 14097.
(c)
(5) A statement as to the general nature of the
business in which the applicant intends to engage.
(d)
(6) A statement as to the classification or
classifications under which the applicant desires to be
qualified.
(e) If the applicant is a person other than an individual, the
full name and residence address of each of its partners, officers,
and directors, and its manager.
(f)
(7) Two recent photographs of the applicant, of a type
prescribed by the commissioner, and two one
classifiable sets set of his or
her fingerprints. fingerprints, to be sent to
a live scan fingerprint provider as directed by the department, if
fingerprints are not submitted in person with a live scan
fingerprinting service provider certified by the Department of
Justice.
(g)
(8) A verified statement of his or her experience
qualifications. qualifications, unless
applying for an apprentice independent insurance adjuster license.
(h) Such other information, evidence, statements, or documents as
may be required by the commissioner.
(9) Other information, evidence, statements, or documents as may
be required by the commissioner.
(b) A business entity application shall be verified and shall
include all of the following:
(1) The full legal name and residence address of each of its
partners, officers, and directors, and its manager.
(2) The name under which the applicant intends to do business.
(3) The name of a licensed independent insurance adjuster who is
responsible for the business entities compliance with this chapter.
(4) That the applicant paid the fees set forth in Section 14097.
(5) A statement as to the general nature of the business in which
the applicant intends to engage.
(6) A statement as to the classifications under which the
applicant desires to be qualified.
(7) Other information, evidence, statements, or documents as may
be required by the commissioner.
SEC. 13. Section 14025 of the Insurance Code is amended to read:
14025. Before an application for a license is
granted, the applicant , or his or her manager,
shall meet all of the following requirements :
(a) Be at least 18 years of age.
(b) Not have committed acts or crimes constituting grounds for
denial of licensure under Section 480 of the Business and
Professions Code. Sections 1668 and 1669.
(c) Shall have had at least two years of experience in adjusting
insurance claims or the equivalent thereof as determined by the
commissioner. commissioner, unless applying
for an apprentice independent insurance adjuster license.
(d) If the applicant resides in a state that does not license
independent insurance adjusters, he or she is required to be licensed
in good standing to designate California as his or her home state.
(e) (1) Completed a 20-hour prelicensing education course of
study.
(2) A nonresident applicant currently licensed as a home state
independent insurance adjuster in another state who has met that
state's prelicensing education requirements is exempt from completing
the prelicensing education requirement.
(f) Successfully passed the examination for the independent
insurance adjuster license, unless he or she qualifies for an
exemption in Section 14026.
(d)
(g) Comply with such those
other qualifications as that the
commissioner may fix by rule. require by
regulation.
SEC. 14. Section 14025.1 is added to the Insurance Code, to read:
14025.1. (a) The apprentice independent insurance adjuster
license is a license to facilitate the experience, education, and
training necessary to ensure reasonable competency in the
responsibilities and duties of an independent insurance adjuster.
(b) An individual applying for an apprentice independent insurance
adjuster license shall submit an application in a format prescribed
by the commissioner and shall declare under penalty of suspension,
revocation, or refusal of the license that the statements made in the
application are true, correct, and complete to the best of the
individual's knowledge and belief. Before approving the application,
the commissioner shall determine that the individual meets all of the
following:
(1) Is at least 18 years of age.
(2) Is a resident of California and has designated California as
his or her home state.
(3) Has a business or mailing address in California for the
acceptance of service of process.
(4) Has not committed any act that is a ground for suspension,
revocation, or denial of licensure as set forth in Sections 1668,
1668.1, and 1669.
(5) Is trustworthy, reliable, and of good reputation, evidence of
which may be determined by the commissioner.
(6) Has paid the fees set forth in subdivision (h) of Section
14097.
(c) The apprentice independent insurance adjuster license shall be
subject to the following terms and conditions:
(1) The applicant shall submit, with the apprentice independent
insurance adjuster application, an attestation from a licensed
independent insurance adjuster certifying that the apprentice will be
subject to training, direction, and control by the licensed
independent insurance adjuster and further certifying that the
licensed independent insurance adjuster assumes responsibility for
the actions of the apprentice in the apprentice's capacity as an
independent insurance adjuster.
(2) The apprentice independent insurance adjuster is only
authorized to adjust claims in California.
(3) The apprentice independent insurance adjuster is restricted to
participation in the investigation, settlement, and negotiation of
claims subject to the review and final determination of the claim by
a supervising licensed independent insurance adjuster.
(4) Compensation of an apprentice independent insurance adjuster
shall only be on a salaried or hourly basis.
(5) The apprentice independent insurance adjuster shall not be
required to take and successfully complete the independent insurance
adjuster examination to adjust claims as an apprentice independent
insurance adjuster. At any time during the apprenticeship, the
apprentice independent insurance adjuster may choose to take the
examination. If the individual takes and successfully completes the
independent insurance adjuster exam, the apprentice independent
insurance adjuster license shall automatically terminate and an
independent insurance adjuster license shall be issued to that
individual in its place.
(6) The apprentice independent insurance adjuster license is valid
for a period not to exceed 12 months and is nonrenewable.
(7) The licensee shall be subject to suspension, revocation, or
denial pursuant to Sections 1668, 1668.1, and 1669.
(8) The applicant shall submit two recent photographs of the
applicant, of a type prescribed by the commissioner, and one
classifiable set of his or her fingerprints, to be sent to a live
scan fingerprint provider as directed by the department, if
fingerprints are not submitted in person with a live scan
fingerprinting service provider certified by the Department of
Justice.
SEC. 15. Section 14026 of the Insurance Code is repealed.
14026. The commissioner may require an applicant, or his or her
manager, to demonstrate his or her qualifications by a written or
oral examination, or a combination of both.
SEC. 16. Section 14026 is added to the Insurance Code, to read:
14026. (a) An applicant for an independent insurance adjuster
license, unless applying for an apprentice independent insurance
adjuster license or crop insurance adjuster license, shall pass a
written examination.
(1) The examination shall test the knowledge of the applicant
concerning the duties and responsibilities of an independent
insurance adjuster and this code.
(2) An applicant applying for an examination shall remit a
nonrefundable fee as prescribed by the commissioner in Section 14097.
(b) An individual who applies for an independent insurance
adjuster license in California who holds a home state license in
another state as an independent insurance adjuster shall not be
required to complete the examination if he or she successfully passed
an examination as a condition of receiving an independent insurance
adjuster license in his or her home state. This exemption applies to
individuals who are currently licensed in their home state or if the
home state license expired and the application is received by the
commissioner within 90 days of expiration.
(c) An individual who applies for an apprentice independent
insurance adjuster license pursuant to Section 14025.1, and who
adjusts claims in that capacity, shall not be required to take and
successfully complete the independent insurance adjuster examination.
SEC. 17. Section 14027 of the Insurance Code is repealed.
14027. Payment of the application fee prescribed by this chapter
entitles an applicant, or his or her manager, to one examination
without further charge. If the person fails to pass the examination,
he or she shall not be eligible for any subsequent examination except
upon payment of the reexamination fee prescribed by this chapter for
each such subsequent examination.
SEC. 18. Section 14028 of the Insurance Code is amended to read:
14028. After a hearing hearing, the
commissioner may deny a license unless the application makes a
showing satisfactory to the commissioner that the applicant, if an
individual, has not, or if the applicant is a person other than an
individual, that its manager and each of its officers and partners
have not done any of the following :
(a) Committed any acts or crimes constituting grounds for denial
of licensure under Section 480 of the Business and Professions Code.
(b)
(a) Been refused a license under this chapter or had a
license revoked.
(c)
(b) Been an officer, partner, or manager of any person
who has been refused a license under this chapter or whose license
has been revoked.
(d)
(c) While unlicensed committed, or aided and abetted the
commission of, any act for which a license is required by this
chapter.
(e)
(d) Committed any act or crime constituting grounds for
denial of license licensure under
Section 1668.
SEC. 19. Section 14029 of the Insurance Code is repealed.
14029. (a) The business of each licensee shall be operated under
the active direction, control, charge, or management of the licensee,
if the licensee is qualified, or the person who has qualified to act
as the licensee's manager, if the licensee is not qualified.
(b) No person shall act as a manager of a licensee until he or she
has complied with each of the following:
(1) Demonstrated his or her qualifications by a written or oral
examination, or a combination of both, if required by the
commissioner.
(2) Made a satisfactory showing to the commissioner that he or she
has the qualifications prescribed by Section 14025 and that none of
the facts stated in Section 14028 or 14028.5 exist as to him or her.
(c) If the manager, who has qualified as provided in this section,
ceases for any reason whatsoever to be connected with the licensee
to whom the license is issued, the licensee shall notify the
commissioner in writing 30 days from the cessation. If notice is
given, the license shall remain in force for a reasonable length of
time to be determined by the rules of the commissioner pending the
qualifications, as provided in this chapter, of another manager. If
the licensee fails to notify
the commissioner within the 30-day period, his or her license shall
be subject to suspension or revocation and may be reinstated only
upon the filing of an application for reinstatement, payment of the
reinstatement fee, if any is due, and the qualification of a manager
as provided herein.
(d) Every manager shall renew his or her authority by satisfying
the requirements of Article 8 (commencing with Section 14090).
SEC. 20. Section 14029 is added to the Insurance Code, to read:
14029. Each organization licensed under this chapter shall
designate an individual also licensed as an independent insurance
adjuster to be responsible for the organization's compliance with
state law.
SEC. 21. Section 14030 of the Insurance Code is repealed.
14030. Whenever the individual on the basis of whose
qualifications a license under this chapter has been obtained ceases
to be connected with the licensee for any reason whatever, the
business may be carried on for such temporary period and under such
terms and conditions as the commissioner shall provide by regulation.
SEC. 22. Section 14031 of the Insurance Code is amended to read:
14031. Whenever a A hearing
is held under this chapter to determine whether an
application for a license should be granted or to determine
the qualifications of a licensee's manager, the proceedings
shall be conducted in accordance with Chapter 5 (commencing
with Section 11501) of Part 1 of Division 3 of Title 2 of the
Government Code, and the commissioner shall have all of the powers
granted therein.
SEC. 23. Section 14032 of the Insurance Code is amended to read:
14032. The form and content of the license shall be determined by
the commissioner in accordance with Section 164 of the
Business and Professions Code. commissioner.
SEC. 24. Section 14037 of the Insurance Code is repealed.
14037. A licensee shall at all times be legally responsible for
the good conduct in the business of each of his or her employees or
agents, including his or her manager.
SEC. 25. Section 14038 of the Insurance Code is amended to read:
14038. (a) Any licensee or officer, director, partner,
or manager or partner of a licensee may divulge
to any law enforcement officer or district attorney, or to his or her
representative, any information he or she may acquire as to any
criminal offense, but he or she shall not divulge to any other
person, except as he or she may be required by law to do so, any
information acquired by him or her except at the direction of the
employer or client for whom the information was obtained.
(b) No licensee A licensee
or officer, director, partner, manager, or employee
or partner of a licensee shall not
knowingly make any false report to his or her employer or client for
whom information was being obtained.
(c) No written A written report
shall not be submitted to a client except by the
licensee, qualifying manager, or a person authorized by one or either
of them, and such person submitting the report
licensee who shall exercise diligence in ascertaining whether
or not the facts and information in such a
that report are true and correct.
(d) No licensee, A licensee or
officer, director, partner, manager, or employee
or partner of a licensee shall not use a badge
in connection with the official activities of the licensee's
business.
(e) No licensee, A licensee or
officer, director, partner, manager, or employee of a
licensee, shall use a title, or wear a uniform, or use an insignia,
or use an identification card, or partner of a
licensee shall not use a title, wear a uniform, use an
insignia, use an identification card, or make any statement
with the intent to give an impression that he or she is connected in
any way with the federal government, a state government, or any
political subdivision of a state government.
(f) No licensee, A licensee or
officer, director, partner, manager, or employee
or partner of a licensee, shall not enter any
private building or portion thereof without the consent of the owner
or of the person in legal possession thereof.
(g) No licensee shall A
licensee shall not appear as an assignee party in any
proceeding involving claim and delivery, replevin, or other
possessory action, action to foreclose a chattel mortgage, mechanic's
lien, materialman's lien, or any other lien.
(h) No licensee shall permit an employee or
A licensee shall not permit an agent in his or her own
name to advertise, engage clients, furnish reports, or present bills
to clients, or in any manner whatever to conduct business for which a
license is required under this chapter. All business of the licensee
shall be conducted in the name of and under the control of the
licensee.
(i) No licensee A licensee
acting as an independent automobile damage appraiser or
adjuster or as an automobile insurance claims adjuster,
appraiser appraiser, or representative shall
not receive any financial benefit from an automobile
repair facility. "Financial benefit" means the receiving of any
commission or gratuity, discount on repair costs, free repairs,
employment by a repair facility, or possession of more than 3 percent
direct ownership in an automobile repair facility located in this
state.
SEC. 26. Section 14039 of the Insurance Code is amended to read:
14039. No A person licensed as an
independent insurance adjuster shall not do any
of the following:
(a) Fail to disclose his or her full financial interest in a
contract or agreement executed by him or her for the adjustment of a
claim prior to the execution thereof.
(b) Use any misrepresentation to solicit a contract or agreement
to adjust a claim.
(c) Solicit or accept remuneration from, or have a financial
interest exceeding 3 percent in, any salvage, repair, or other firm
, which that obtains business in
connection with any claim which that he
or she has a contract or agreement to adjust.
SEC. 27. Section 14040 of the Insurance Code is amended to read:
14040. Any badge or cap insignia worn by a person who is a
licensee, officer, director, partner, manager, or employee
or partner of a licensee shall be of a design
approved by the commissioner, and shall bear on its face a
distinctive word indicating the name of the licensee and an
employee number by which such person may be identified by the
licensee. licensee.
SEC. 28. Section 14042 of the Insurance Code is amended to read:
14042. No licensee shall (a)
A licensee shall not conduct a business under a
fictitious or other business name unless and until he or she has
obtained the written authorization of the commissioner to do so.
The
(b) The commissioner shall not
authorize the use of a fictitious or other business name
which that is so similar to that of a public
officer or agency or of that used by another licensee that the public
may be confused or misled thereby.
The
(c) The authorization shall
require, as a condition precedent to the use of any fictitious name,
that the licensee comply with Section 1724.5 of this code
and Chapter 5 (commencing with Section 17900) of Part 3 of Division 7
of the Business and Professions Code. 1724.5.
A
(d) A licensee desiring to
conduct his or her business under more than one fictitious business
name shall obtain the authorization of the commissioner in the manner
prescribed in this section for the use of each such
that name.
The
(e) The licensee shall pay a fee
of ten dollars ($10) for each authorization to use an additional
fictitious business name and for each change in the use of a
fictitious business name. If the original license is issued in a
nonfictitious name and authorization is requested to have the license
reissued in a fictitious business name, the licensee shall pay a fee
of twelve dollars ($12) for such that
authorization.
SEC. 29. Section 14061 of the Insurance Code is amended to read:
14061. The commissioner may suspend or revoke a license issued
under this chapter or may issue a restricted license in accordance
with Section 14026.5 if he or she determines that the
licensee, or his or her manager, if an individual,
licensee or if the licensee is a person other than an
individual, that any of its officers, directors, partners, or its
manager, designated responsible person
has done any of the following :
(a) Made any false statement or given any false information in
connection with an application for a license or a renewal or
reinstatement of a license.
(b) Violated any provisions of this chapter.
(c) Violated any rule of the commissioner adopted pursuant to the
authority contained in this chapter.
(d) Been convicted of any crime substantially related to the
qualifications, functions functions,
and duties of the holder of the registration or license in question.
(e) Impersonated, or permitted or aided and abetted an employee to
impersonate impersonate, a law
enforcement officer or employee of the United States of America, or
of any state or political subdivision thereof.
(f) Committed or permitted any employee to commit any act, while
the license was expired which that
would be cause for the suspension or revocation of a license, or
grounds for the denial of an application for a license.
(g) Willfully failed or refused to render to a client services or
a report as agreed between the parties and for which compensation has
been paid or tendered in accordance with the agreement of the
parties.
(h) Committed assault, battery, or kidnapping, or used force or
violence on any person, without proper justification.
(i) Knowingly violated, violated or
advised, encouraged, or assisted the violation of any court order or
injunction in the course of business as a licensee.
(j) Acted as a runner or capper for any attorney.
(k) Committed any act which that is
a ground for denial of an application for license under this chapter.
( l ) Purchased, possessed, or transported any tear gas
weapon except as authorized by law. A violation of this subdivision
may be punished by the suspension of a license for a period to be
determined by the commissioner.
SEC. 30. Section 14063 of the Insurance Code is amended to read:
14063. The commissioner may suspend or revoke a license issued
under this chapter or may issue a restricted license in accordance
with Section 14026.5 if the commissioner determines that the
licensee, or his or her manager, licensee, if
an individual, or if the licensee is a person other than an
individual, that any of its officers, directors, partners, or its
manager, has designated responsible person
has done any of the following :
(a) Used any letterhead, advertisement, or other printed matter,
or in any matter whatever represented that he or she is an
instrumentality of the federal government, or of a state
or any political subdivision thereof.
(b) Used a name different from that under which he or she is
currently licensed in any advertisement, solicitation, or contract
for business.
SEC. 31. Section 14064 of the Insurance Code is amended to read:
14064. (a) The commissioner may suspend or
revoke a license issued under this chapter or may issue a restricted
license in accordance with Section 14026.5 if the commissioner
determines that the licensee, or his or her manager,
licensee, if an individual, or if the licensee
is a person other than an individual, that any of its officers,
directors, partners, or its manager,
designated responsible person has committed any act in the
course of the licensee's business constituting dishonesty or fraud.
"Dishonesty
(b) "Dishonesty or fraud" as used
in this section includes, in addition to other acts not specifically
enumerated herein, all of the following:
(a)
(1) Knowingly making a false statement relating to
evidence or information obtained in the course of employment, or
knowingly publishing a slander or a libel in the course of business.
(b)
(2) Using illegal means in the collection or attempted
collection of a debt or obligation.
(c)
(3) Manufacture of evidence.
(d)
(4) Acceptance of employment adverse to a client or
former client relating to a matter with respect to which the licensee
has obtained confidential information by reason of or in the course
of his or her employment by such that
client or former client.
(e)
(5) Impersonating, or permitting or aiding and abetting
an employee to impersonate impersonate,
a law enforcement officer or employee of the United States of
America, or of any state or political subdivision thereof.
SEC. 32. Section 14078 of the Insurance Code is repealed.
14078. As used in this article, "nonresident" means a person who
is not a resident of this state at the time of the performance of the
act referred to in Section 14071.
SEC. 33. Section 14078 is added to the Insurance Code, to read:
14078. (a) Unless refused licensure pursuant to Sections 14060 to
14065, inclusive, a nonresident person shall receive a nonresident
independent insurance adjuster license if all of the following apply:
(1) The applicant is currently licensed in good standing as an
independent insurance adjuster in his, her, or its resident or home
state.
(2) The applicant paid the fees required by Section 14097.
(3) The applicant submitted to the commissioner the completed
application for licensure.
(4) The applicant's home state awards nonresident independent
insurance adjuster licenses to residents of California on the same
basis.
(b) The commissioner may verify the independent insurance adjuster'
s licensing status through any appropriate database, including the
Producer Database maintained by the National Association of Insurance
Commissioners, its affiliates or subsidiaries, or may request
certification of good standing.
(c) As a condition to the continuation of a nonresident
independent insurance adjuster license, the licensee shall maintain a
resident independent insurance adjuster license in his, her, or its
home state.
(1) The nonresident independent insurance adjuster license issued
under this chapter shall terminate and be surrendered immediately to
the commissioner if the resident independent insurance adjuster
license terminates for any reason, unless the termination is due to
the independent insurance adjuster being issued a new resident
independent insurance adjuster license in his, her, or its new home
state.
(2) The nonresident independent insurance adjuster license shall
terminate if the person's home state does not award nonresident
independent insurance adjuster licenses to residents of California on
the same basis.
(3) (A) The licensee is required to give notice of resident
independent insurance adjuster license termination to any state that
issued a nonresident independent insurance adjuster license.
(B) The notice is required to be given within 30 days of the
termination date. If the resident independent insurance adjuster
license was terminated for change in resident home state, then the
notice is required to include both the previous and current address.
(4) Maintaining a resident independent insurance adjuster license
is required for the nonresident independent insurance adjuster
license to remain valid.
SEC. 34. Section 14079 is added to the Insurance Code, to read:
14079. (a) An independent insurance adjuster shall be honest and
fair in all communications with the insured, the insurer, and the
public.
(b) An independent insurance adjuster shall provide policyholders
and claimants with prompt and knowledgeable service and courteous,
fair, and objective treatment at all times.
(c) An independent insurance adjuster shall not give legal advice
and shall not deal directly with any policyholder or claimant who is
represented by legal counsel without the consent of the legal counsel
involved.
(d) An independent insurance adjuster shall comply with all local,
state, and federal privacy and information security laws.
(e) An independent insurance adjuster shall identify himself or
herself as an independent insurance adjuster and, if applicable,
shall identify his or her employer when dealing with any policyholder
or claimant.
(f) An independent insurance adjuster shall not have any financial
interest in any adjustment or shall not acquire for himself,
herself, or any person any interest or title in salvage, without
first receiving written authority from the principal.
SEC. 35. Section 14080 of the Insurance Code is amended to read:
14080. Any person who knowingly falsifies the fingerprints or
photographs submitted under paragraph (7) of subdivision
(f) (a) of Section 14024 or
paragraph (8) of subdivision (c) of Section 14025.1 is guilty
of a felony. Any person who violates any of the other provisions of
this chapter is guilty of a misdemeanor punishable by fine not to
exceed five hundred dollars ($500), or by imprisonment in the county
jail not to exceed one year, or by both such
the fine and imprisonment.
SEC. 36. Section 14090.1 of the Insurance Code is amended to read:
14090.1. (a) An individual who holds an independent
insurance adjuster license and who is not exempt under subdivision
(b) shall satisfactorily complete a minimum of 24 hours, of which
three hours are to be in ethics, of continuing education courses
pertinent to the duties and responsibilities of an independent
insurance adjuster license reported
license and shall report the completion of this coursework to
the insurance commissioner on a biennial basis in conjunction with
his or her license renewal cycle.
(b) This section does not apply to any of the following:
(1) A licensee not licensed for one full year prior to the end of
the applicable continuing education biennium.
(2) A licensee holding a nonresident independent
insurance adjuster license who has met the continuing education
requirements of his or her designated resident
home state.
(3) An individual licensed as an independent insurance
adjuster and as a property or casualty broker-agent, pursuant to
Section 1625, who has met the continuing education requirements
specified in Section 1749.3.
(4) An individual licensed as an apprentice independent insurance
adjuster pursuant to Section 14025.1.
SEC. 37. Section 14097 of the Insurance Code is amended to read:
14097. The amount of fees prescribed by this chapter, unless
otherwise fixed, is that fixed in the following schedule:
(a) The application fee for the qualifying examination
for an original license is twenty-nine dollars ($29).
(b) The application fee for an original branch office certificate
is eighteen dollars ($18).
(c) The fee for an original license application is an
amount equal to the renewal fee in effect on the last regular renewal
date before the date on which the license is issued, except that, if
the license will expire less than one year after its issuance, then
the fee is an amount equal to 50 percent of the renewal fee in effect
on the last regular renewal date before the date on which the
license is issued. The commissioner may, by appropriate regulation,
provide for the waiver or refund of the initial license fee where the
license is issued less than 45 days before the date on which it will
expire.
(d) The renewal fee shall be fixed by the commissioner as follows:
(1) For a license as an independent insurance adjuster,
not more than one hundred eighteen dollars ($118).
(2) For a branch office certificate, not more than twenty-four
dollars ($24).
(e) The application and license fee for classifications prescribed
by the commissioner, in addition to those provided for in this
chapter, and the application and license fees for a change in the
type of business organization of a licensee, shall be in the amount
prescribed by rule and regulation of the commissioner.
(f) The delinquency fee shall be 50 percent of the renewal fee in
effect on the date of expiration, but not more than
twenty-nine dollars ($29). expiration.
(g) The fee for reexamination of an applicant or his
manager is twelve dollars ($12).
(h) The application fee for an apprentice independent insurance
adjuster license shall be fixed by the commissioner by regulation and
shall be reasonably related to the actual cost to the department in
performing its duties under this chapter.
SEC. 38. Section 14099 of the Insurance Code is amended to read:
14099. Application or license fee fees
shall not be refunded except in accordance with
Section 158 of the Business and Professions Code.
pursuant to Section 1751.5.
SEC. 39. Section 15001 of the Insurance Code is amended to read:
15001. As used in this chapter the following terms have the
following meanings :
(a) "Commissioner" means the Insurance Commissioner.
(b) "Department" means the Department of Insurance.
(c) "Fingerprints" means an impression of the lines on the finger
taken for the purposes of identification
(d) "Home state" means the District of Columbia and any state or
territory of the United States in which the public insurance adjuster'
s principal place of residence or principal place of business is
located. If neither the state in which the public insurance adjuster
maintains the principal place of residence nor the state in which the
public insurance adjuster maintains the principal place of business
has a substantially similar law governing public insurance adjusters,
the public insurance adjuster may declare another state in which it
becomes licensed and acts as a public insurance adjuster to be the
"home state."
(c)
(e) "Licensee" means a person licensed under this
chapter.
(d)
(f) "Person" includes any individual, firm, company,
association, organization, partnership, limited liability company,
and corporation.
SEC. 40. Section 15007 of the Insurance Code is repealed.
15007. A public insurance adjuster within the meaning of this
chapter is a person who, for compensation, acts on behalf of or aids
in any manner, an insured in negotiating for or effecting the
settlement of a claim or claims for loss or damage under any policy
of insurance covering real or personal property or any person who
advertises, solicits business, or holds himself or herself out to the
public as an adjuster of those claims and any person who, for
compensation, investigates, settles, adjusts, advises, or assists an
insured with reference to claims for those losses on behalf of any
public insurance adjuster.
SEC. 41. Section 15007 is added to the Insurance Code, to read:
15007. "Public insurance adjuster," for purposes of this chapter,
means any person who, for compensation or any other thing of value
on behalf of an insured, does any of the following:
(a) Acts or aids, solely in relation to first party claims arising
under insurance contracts that insure the real or personal property
of the insured, on behalf of an insured in negotiating for, or
effecting the settlement of, a claim for loss or damage coverage by
an insurance contract.
(b) Advertises for employment as a public adjuster of insurance
claims or solicits business or represents himself or herself to the
public as a public insurance adjuster of first party insurance claims
for losses or damages arising out of policies of insurance that
insure real or personal property.
(c) Directly or indirectly solicits business, investigates, or
adjusts losses, or advises an insured about first party claims for
losses or damages arising out of policies of insurance that insure
real or personal property for another person engaged in the business
of adjusting losses or damages covered by an insurance policy, for
the insured.
SEC. 42. Section 15008 of the Insurance Code is amended to read:
15008. This chapter does not apply to any of the following
:
(a) An officer or employee of the United States of
America America, or of the state or of a
political subdivision thereof while the officer or employee is
engaged in the performance of his or her official duties.
(b) A charitable philanthropic society duly incorporated under the
laws of this state which that is
organized and maintained for the public good and not for private
profit.
(c) An attorney at law in performing his or her duties as an
attorney at law.
(d) Admitted insurers, agents, and insurance brokers licensed by
the state performing duties in connection with insurance transactions
by them.
(e) The legal owner of personal property which
that has been sold under a conditional sales agreement or
a mortgagee under the terms of a chattel mortgage.
(f) Any salaried office employee who performs exclusively clerical
and administrative duties attendant to the disposition of the
business regulated by this chapter.
(g) Photographers, estimators, appraisers, engineers, and
arbitrators, who are employed exclusively by a public insurance
adjuster for the purpose of furnishing technical assistance to a
licensed public insurance adjuster.
(h) A private investigator licensed pursuant to Chapter
11.5 11.3 (commencing with Section 7512) of
Division 3 of the Business and Professions Code while acting within
the scope of that license.
(i) A person who negotiates or settles claims arising under a life
or health insurance policy or an annuity contract.
(j) A licensed health care provider, or employee of a licensed
health care provider, who prepares or files a health claim form on
behalf of a patient.
(k) A person who settles
subrogation claims between insurers.
SEC. 43. Section 15009.1 is added to the Insurance Code, to read:
15009.1. (a) The applicant shall complete a 20-hour prelicensing
course of study for the lines of authority for a public insurance
adjuster license.
(b) An applicant who resides in another state that does not
license public insurance adjusters is eligible to designate
California as his or her home state. He or she is required to
complete the prelicensing education, pass the public insurance
adjuster examination, and meet the license application requirements
before a license can be issued.
(c) An applicant licensed as a public insurance adjuster in
another state is exempt from completing a prelicensing education
course to apply for a California public insurance adjuster license
if, at the time of application, the applicant's out-of-state license
is current or was canceled within 90 calendar days. The applicant is
required to be a licensee in good standing in his or her home state.
SEC. 44. Section 15010 of the Insurance Code is amended to read:
15010. An application shall be verified and shall include all of
the following:
(a) The full name and business address of the applicant.
(b) The name under which the applicant intends to do business.
(c) A statement as to the general nature of the business in which
the applicant intends to engage.
(d) A statement as to the classification or
classifications under which the applicant desires to be qualified.
(e) If the applicant is a person other than an individual, the
full name and resident address of each of its partners, officers, and
directors.
(f) Two recent photographs of the applicant, of the
a type prescribed by the commissioner, and
two one classifiable sets
set of his or her fingerprints.
fingerprints, to be sent to a live scan fingerprint
provider as directed by the department, if fingerprints are not
submitted in person with a live scan fingerprinting service provider
certified by the Department of Justice.
(g) A verified statement of his or her experience qualifications.
(h) Such other Other information,
evidence, statements statements, or
documents as may be required by the commissioner.
SEC. 45. Section 15011 of the Insurance Code is amended to read:
15011. Before an application for a license is granted, the
applicant shall meet all of the following requirements :
(a) Be at least 18 years of age.
(b) Be a bona fide resident of the State of California.
(c) Must be Be of good character and
shall not have committed acts or crimes constituting grounds for
denial of licensure under Section 1668 or 1669.
(d) Shall have had sufficient experience, or special education or
training, or both, in the handling of loss claims under insurance
contracts as determined by regulations adopted by the commissioner,
and is be competent to transact
business and discharge the responsibilities of a public insurance
adjuster in such a manner as to safeguard the
interests of the public.
(e) Must maintain Maintain an office
in the State of California with public access during regular
business hours.
(f) Pass an exam given by the commissioner in regard to property
loss adjusting.
(g) Post a surety bond executed by a surety company authorized to
do business in this state in the sum of twenty thousand dollars
($20,000).
(h) For an organization applicant, designate a licensed individual
public insurance adjuster to be responsible for the organization's
compliance with the insurance laws, rules, and regulations of this
state.
(i) For an organization applicant, authorize only licensed
individual public insurance adjusters to exercise authority under the
organization's license.
(h)
(j) Comply with any other qualifications as required by
the commissioner.
SEC. 46. Section 15013 of the Insurance Code is amended to read:
15013. Each applicant for a license as a public insurance
adjuster, except as provided in Section 15014,
adjuster shall, prior to issuance of the license,
personally take and pass, to the satisfaction of the commissioner, an
examination given by the department as follows:
(a) The examination shall be prescribed by the commissioner and
shall be of sufficient scope to reasonably to
test the applicant's knowlege
knowledge , among other things, of basic insurance theory,
essential elements of contracts, technical competence in the handling
of the various lines for which the applicant is being tested, claims
ethics and knowledge of the Unfair Claims
Practices Act, and the duties and responsibilities of public
insurance adjusters under the law.
(b) Such The examination shall be
given to applicants under the supervision of the department
of this state, department or the department's
examination contractor and shall be in written form.
(c) The commissioner shall, within a reasonable period of time,
not to exceed 30 days, transmit the results of the examination and
action taken on the application to the applicant.
(d) In the event an applicant, applicant
who is otherwise qualified, qualified
fails the examination, the commissioner may administer a
reexamination, reexamination after a
waiting period not to exceed six months.
(e) The examination shall be given at those times and places
within the state as the commissioner deems reasonably necessary to
serve the convenience of the department and applicants.
SEC. 47. Section 15015 of the Insurance Code is repealed.
15015. Payment of the application fee prescribed by this chapter
entitles the applicant to one examination without further charge. If
the person fails to pass the examination, he or she shall not be
eligible for any subsequent examination except upon payment of the
reexamination fee prescribed by this chapter for each subsequent
examination.
SEC. 48. Section 15016 of the Insurance Code is repealed.
15016. (a) The commissioner shall issue an interim license to all
qualified individuals for the purpose of training so long as the
persons meet all of the following requirements:
(1) Are employed and under the direct supervision of a person
licensed under the provisions of this chapter.
(2) Qualify under the applicable provisions of Section 15011.
(3) Pay a license fee of one hundred dollars ($100).
(4) Comply with any other qualifications required by the
commissioner.
(b) An interim license may be issued for a period not to exceed
one year and may not be renewed.
SEC. 49. Section 15016 is added to the Insurance Code, to read:
15016. (a) The apprentice public insurance adjuster license is a
license to facilitate the training necessary to ensure reasonable
competency to fulfill the responsibilities of a public insurance
adjuster as defined in Section 15007.
(b) The apprentice public insurance adjuster license is subject to
the following terms and conditions:
(1) The applicant shall submit, with an application for an initial
apprentice public insurance adjuster license, an attestation or
certification from a licensed public insurance adjuster assuming
responsibility for all actions of that applicant.
(2) The apprentice public insurance adjuster is authorized to
adjust claims only in California.
(3) The applicant is required to qualify under the applicable
provisions of Section 15011.
(4) The applicant is required to pay a license fee of one hundred
dollars ($100).
(5) The applicant is required to comply with any other
qualifications required by the commissioner.
(6) The apprentice public insurance adjuster shall not be required
to take and successfully complete the prescribed public insurance
adjuster examination.
(7) The licensee shall at all times be an employee of a public
insurance adjuster and be subject to training, direction, and control
by a licensed public insurance adjuster.
(8) The apprentice public insurance adjuster license is for a
period not to exceed 12 months, and the license shall not be renewed.
(9) The licensee is restricted to participation in factual
investigation, tentative closing, and solicitation of losses subject
to the review and final determination of a licensed public insurance
adjuster.
(10) Compensation of an apprentice public insurance adjuster shall
only be on a salaried or hourly basis.
(11) The licensee shall be subject to suspension, revocation, or
conditions in accordance with Section 1668.
(12) The applicant shall submit two recent photographs of the
applicant, of a type prescribed by the commissioner, and one
classifiable set of his or her fingerprints, to be sent to a live
scan fingerprint provider as directed by the department, if
fingerprints are not submitted in person with a live scan
fingerprinting service provider certified by the Department of
Justice.
SEC. 50. Section 15017 of the Insurance Code is amended to read:
15017. (a) A nonresident license shall be
issued by the commissioner to qualified persons who meet the
requirements of this chapter as set forth in subdivisions (a), (c),
(d), (e), (f), (g), and (h) (j) of
Section 15011 15011, and who have
appointed the commissioner as an agent for service of process in this
state.
(b) Unless denied licensure pursuant to Sections 15018, 15018.5,
and 15019, a nonresident person shall receive a nonresident public
insurance adjuster license if all of the following apply:
(1) The person is currently licensed in good standing as a public
insurance adjuster in his or her home state.
(2) The person has paid the fees required by Section 15060.
(3) The person has provided proof of financial responsibility as
required by Section 15033.
(4) The individual has submitted to the commissioner the completed
application for licensure.
(5) The person's home state awards nonresident public insurance
adjuster licenses to residents of California on the same basis.
SEC. 51. Section 15020 of the Insurance Code is amended to read:
15020. The form and content of the license shall be determined by
the commissioner in accordance with Section 164 of the
Business and Professions Code. commissioner.
SEC. 52. Section 15027 of the Insurance Code is amended to read:
15027. (a) No A licensee shall
not , directly or indirectly, act within this state as a
public insurance adjuster without having first entered into a
contract, in writing, on a form approved by the insurance
commissioner and executed in duplicate by the public adjuster and the
insured or a duly authorized representative. One original contract
shall be kept on file by the licensee, available at all times for
inspection, without notice, by the commissioner or his or her duly
authorized representative, and one original contract shall be given
to the insured.
(b) The written contract between the licensee and the insured
shall contain each of the following:
(1) Title of "Public Adjuster Contract."
(2) The name, business name, license number, telephone number, and
address of the licensee.
(3) The name and address of the insured.
(4) A description of the loss and its location, if applicable.
(5) The name of the insurer and the policy number, if known.
(6) The full salary, fee, commission, or other consideration the
licensee is to receive for services under the contract.
(7) The following statement: "No public adjuster shall charge a
fee, commission, or other valuable consideration based, in whole or
in part, on any amount paid to the insured by the insurer prior to
the date of the written contract between the insured and the public
adjuster."
(7)
(8) A description of the services to be provided to the
insured.
(8)
(9) Signatures of the licensee and the insured.
(9)
(10) The date the contract was signed by the licensee
and the date the contract was signed by the insured.
(10)
(11) The following statement: "As a public adjuster, I
am required by the California Insurance Code to post a surety bond in
the sum of $20,000 to cover certain kinds of claims made by you, the
insured. If you have any questions concerning the surety bond, you
may contact the California Department of Insurance Producer Licensing
Call Center at 1-800-967-9331 or www.insurance.ca.gov."
(11)
(12) A statement of the compensation to the licensee,
including the percentage and base to which the percentage applies.
(12)
(13) A statement that the insured has the right to
rescind the contract within three business
seven calendar days of signing it.
(c) A contract covered by this section shall not contain a
contract term that does any of the following:
(1) Allows the licensee's fee to be collected when money is due
from an insurer, but not paid, or allows a licensee to collect the
entire fee from the first payment issued by an insurer, rather than
as a percentage of each payment issued by an insurer.
(2) Requires the insured to authorize an insurer to issue a
payment only in the name of the licensee.
(3) Imposes late fees or collection costs on the insured.
(d) No A licensee shall not
solicit or attempt to solicit a client for employment during
the progress of a loss-producing occurrence.
A loss-producing occurrence continues to exist under any of the
following conditions:
(1) Any of the circumstances that caused the loss are present.
(2) Emergency responders are present.
(3) An evacuation order is still in effect.
(e) No A licensee or any other
person or entity offering, for a fee, service regulated by this
chapter shall not solicit a client
policyholder for employment or initiate any contact with a
policyholder between the hours of 6 p.m. and 8 a.m.
(f) No A licensee shall not
use any form of contract other than that approved by the
commissioner and which that contains
each of the following:
(1) A provision allowing the client to rescind the contract by
written notice sent or delivered by certified mail, return receipt
requested, or other form of mailing which
that provides proof of mailing, to the licensee by midnight of
the third business seventh calendar day
after the day on which the client signs a contract which
that complies with this section. Each copy of
the contract shall contain a completed form, captioned "Notice of
Cancellation," which that shall be
placed at the end of the contract and be separated from the remainder
of the contract by a printed line. Nothing shall be printed on the
reverse side of the notice form. The notice form shall be completed
by the licensee, and shall contain in type of at least 10-point the
following statement written in the same language, e.g., Spanish, as
used in the contract:
Notice of Cancellation
_____________________________
(Date of Contract)
You may cancel this contract within three business
seven calendar days from the above date without
any penalty or obligation to pay your public adjuster, other than for
reimbursement of moneys paid by your public adjuster for
out-of-pocket emergency expenses for you or on your behalf. If your
public adjuster seeks reimbursement from you for out-of-pocket
emergency expenses, your public adjuster shall provide you with an
itemized statement of those emergency expenses advanced to you or on
your behalf if the cancellation is made within the first
three business seven calendar days after the
contract was initiated. Nothing in this contract permits your public
adjuster to recover any costs, except for out-of-pocket emergency
expenses advanced to you.
If you cancel, any money or other consideration paid by you will
be returned within five business days following the receipt of your
cancellation notice, and any security interest arising out of the
transaction will be canceled.
To cancel this contract, mail or deliver by certified mail, return
receipt requested, or other form of mailing which
that provides proof of mailing, a signed and dated copy
of this cancellation notice, or any other written notice, or send a
telegram to:
_________________________________________________
(name of public adjuster)
at
_________________________________________________
(address of public adjuster's place of business)
not later than midnight of_______________________
(Date)
I hereby cancel this contract____________________
(Date)
_________________________________________________
(Client's signature)
(2) The statement "WE REPRESENT THE INSURED ONLY" prominently
displayed in at least 10-point type.
(3) A provision disclosing the percentage of the insured's claim,
or other fee, that the licensee will charge for his or her services.
The licensee shall obtain the initials of the insured next to this
provision.
(4) A conspicuous statement in at least 10-point type in immediate
proximity to the space reserved for the client's signature, as
follows: "You may cancel this contract at any time before midnight of
the third business seventh calendar
day after the date of this contract. See the notice of cancellation
form at the end of this contract for an explanation of this right."
(g) No A licensee shall
not knowingly make any false report to his or her employer
or divulge to any other person, except as he or she may be required
by law to do so, any information acquired by him or her except at the
direction of the employer or a client for whom the information is
obtained.
(h) No A licensee shall not
use a badge in connection with the official activities of the
licensee's business.
(i) No A licensee shall
not permit an employee or agent in his or her own name to
advertise, engage clients, furnish reports, or present bills to
clients, or in any manner whatever to conduct business for which a
license is required under this chapter.
(j) Pursuant to subdivisions (a) and (c) of Section 15006, the
commissioner shall have the authority to enforce the provisions of
this chapter and prosecute violations thereunder committed by
unlicensed persons or entities that hold themselves out or act as
public insurance adjusters.
(k) For purposes of this section, "business day" shall have the
same meaning given to that term in subdivision (e) of Section 1689.5
of the Civil Code, as in effect on the operative date of this
statute.
(l) The contract and the notice of cancellation set forth in
paragraph (1) of subdivision (f) shall be written in the same
language, e.g., Spanish, as principally used in the negotiation of
the contract.
(m) Within five business days after a contract has been canceled,
the licensee shall tender to the client any payments made by the
client and any note or other evidence of indebtedness, including an
itemized statement of all amounts tendered to the client.
(n) The licensee is not entitled to compensation for services
performed prior to cancellation, other than for reimbursement of
moneys paid by the licensee for out-of-pocket emergency expenses for
the client or on behalf of the client. If the licensee seeks
reimbursement from the client for out-of-pocket emergency expenses,
and if the cancellation is made within the first three
business seven calendar days after the contract
was initiated, the licensee shall provide the client with an itemized
statement of those emergency expenses advanced to the client or on
behalf of the client by the licensee. Nothing in this subdivision
shall permit the licensee to recover any costs, except for
out-of-pocket emergency expenses advanced to the client. Any security
interest shall be canceled upon cancellation of the contract.
(o) Notice of cancellation given by the client need not take the
particular form specified in paragraph (1) of subdivision (f). Notice
of cancellation, however expressed, is effective if it indicates the
intention of the client not to be bound by the contract.
(p) Cancellation occurs when the client gives written notice of
cancellation by certified mail, return receipt requested, or other
form of mailing which that provides
proof of mailing, to the licensee at the address specified in the
contract.
(q) Notice of cancellation, if given by mail, is effective when
sent by certified mail, return receipt requested, or other form of
mailing which that provides proof of
mailing, properly addressed with postage prepaid.
(r) Until the licensee has complied with this section, the client
may cancel the contract.
(s) The contracts shall be executed in duplicate. The licensee
shall retain one original contract, and shall provide the insured
with an original contract.
(t) The licensee shall provide the client with an original
contract and notice of cancellation at the time the client signs the
contract.
(u) Any confession of judgment or waiver of the provisions of this
chapter shall be deemed contrary to public policy and shall be void
and unenforceable.
(v) Prior to the signing of the contract, the licensee shall
provide the insured with a separate printed disclosure document in
the following form that bears the name and license number of the
licensee:
"DISCLOSURE
There are three types of insurance adjusters that could be
involved in the processing of your insurance claim. The definitions
of the three types are as follows:
(1) Public adjusters means the insurance adjusters who do not work
for your insurance company. They work for you, the insured, to
assist in the preparation, presentation, and settlement of your
claim. You hire them by signing a contract and agreeing to pay them a
fee or commission based on a percentage of the settlement, or other
method of compensation. Public adjusters are required to be licensed,
bonded, and tested by the State of California to represent your
interest only.
(2) Company adjusters means the insurance adjusters who are
employees of your insurance company. They represent your insurance
company and are paid by your insurance company. They will not charge
you a fee and are not individually licensed or tested by the State of
California.
(3) Independent adjusters means the insurance adjusters who are
hired on a contract basis by your insurance company to represent the
company in the settlement of the claim. They are paid by your
insurance company. They will not charge you a fee.
You have the right, but are not required, to use the services of a
public adjuster in the preparation and handling of your insurance
claim.
Public adjusters cannot solicit your business while the loss is
underway, or between the hours of 6 p.m. and 8 a.m.
Your "Public Adjuster Contract," with a public adjuster
representing you, should clearly indicate the amount of the fee you
will be paying to your public adjuster. Your contract, with this fee
percentage, should be acknowledged by your initials on the "Public
Adjuster Contract." The salary, fee, commission, or other
consideration is to be paid by you (the insured), not the insurance
company (insurer).
You have the right to cancel the contract with your public
adjuster, without any penalty or obligation, within three
business seven calendar days from the date the
contract is signed.
If you cancel the contract with your public adjuster, any money or
other consideration paid by you will be returned within five
business days following the receipt of your cancellation notice, and
any security interest arising out of the transaction will be
canceled.
To cancel the contract with your public adjuster, mail or deliver
by certified mail, return receipt requested, or other form of mailing
which that provides proof of mailing,
a signed and dated copy of the cancellation notice, or any other
written notice, or send a telegram to the public adjuster at the
address in the contract.
You have the right to, and may, communicate with your insurance
company at any time if you feel the need during the claims process.
If you have any concerns or questions, the officers at the
California Department of Insurance Consumer Hotline are there to help
you. Please call them at 1-800-927-HELP (4357), or
www.insurance.ca.gov."
(w) No later than three business seven
calendar days after the cancellation has expired, the public
adjuster shall notify the insurer, its adjuster, or its attorney,
that he or she has entered into a written contract with the insured.
(x) If the licensee misrepresents or conceals a material fact from
the insured prior to execution of the contract, the insured is
entitled to rescind the contract without time limit.
SEC. 53. Section 15027.1 of the Insurance Code is amended to read:
15027.1. (a) Notwithstanding In addition
to the restrictions in subdivision (e) of Section 15027, a
licensee shall not solicit a contract of engagement for residential
properties under this chapter until seven calendar days have elapsed
after the occurrence of a disaster. from the
conclusion of a loss-producing occurrence as defined in subdivision
(d) of Section 15027.
(b) Subdivision (a) shall not apply if the licensee is contacted
directly by the insured or the insured's representative.
(c) For the purposes of this section, "disaster" means a
loss-producing event that damages or destroys more than 25 dwellings,
or a "disaster" as that term is defined in subdivision (b) of
Section 1689.14 of the Civil Code.
SEC. 54. Section 15031 of the Insurance Code is amended to read:
15031. (a) A licensee shall not conduct a business under a
fictitious or other business name unless and until he or she has
obtained the written authorization of the commissioner to do so.
(b) The commissioner shall not authorize the use of a fictitious
or other business name that is so similar to that of a public officer
or agency or that is used by another licensee that the
public may be confused or misled thereby.
(c) The authorization shall require, as a condition
precedent to the use of a fictitious name, that the licensee comply
with Section 1724.5 of this code and Chapter 5 (commencing
with Section 17900) of Part 3 of Division 7 of the Business and
Professions Code. 1724.5.
(d) A licensee desiring to conduct his or her business under more
than one fictitious name shall obtain the authorization of the
commissioner in a manner prescribed in this section for the use of
additional fictitious names.
(e) The licensee shall pay a fee of ten dollars ($10) for each
authorization to use an additional fictitious name and for each
change in the use of a fictitious business name. If the original
license is issued in a nonfictitious name and authorization is
requested to have the license reissued in a fictitious business name,
the licensee shall pay a fee of ten dollars ($10) for that
authorization.
SEC. 55. Section 15036 of the Insurance Code is amended to read:
15036. In lieu of the surety bond required by this chapter there
may be deposited with the State of California the sum of twenty
thousand dollars ($20,000) in cash, or evidence of deposit of the sum
of twenty thousand dollars ($20,000) in banks authorized to do
business in this state and insured by the Federal Deposit Insurance
Corporation, or investment certificates or share accounts in the
amount of twenty thousand dollars ($20,000) issued by a savings
association doing business in this state and insured by the Federal
Deposit Insurance Corporation, or evidence of a certificate of funds
or share account of the sum of twenty thousand dollars ($20,000) in a
credit union as defined in Section 14000
14002 of the Financial Code whose share deposits are guaranteed
by the National Credit Union Administration or guaranteed by any
other agency approved by the Department of Financial
Institutions. Business Oversight.
SEC. 56. Section 15053 of the Insurance Code is amended to read:
15053. Any person who knowingly falsifies the fingerprints or
photographs submitted under subdivision (f) of Section 15010 or
paragraph (12) of subdivision (b) of Section 15016 is guilty of
a felony. Any person who violates any of the other provisions of
this chapter is guilty of a misdemeanor punishable by fine not to
exceed five hundred dollars ($500) or by imprisonment in the county
jail not to exceed one year, or by both that fine and imprisonment.
SEC. 57. Section 15056 of the Insurance Code is amended to read:
15056. (a) Except as otherwise provided in
this article, an expired license or branch office certificate may be
renewed at any time within one year after its expiration on the
filing of an application for renewal on a form prescribed by the
commissioner, and the payment of a renewal fee in effect on the
last preceding regular actual renewal
date. If the license or certificate is renewed more than 30
days after its expiration, the licensee, as a condition
precedent to renewal, shall also pay the delinquency fee prescribed
by this chapter. Renewal under this section shall be effective on the
date on which the application is filed, on the date on which the
renewal fee is paid, or on the date on which the delinquency fee, if
any, is paid, whichever last occurs last
. If so renewed, the license or certificate shall continue in
effect through the date provided in Section 15044 which
15054 that next occurs after the effective date
of the renewal, when it shall expire if it is not again renewed.
Renewal
(b) Renewal of a license or
certificate shall does not prohibit the
bringing of disciplinary proceedings for an act committed before the
effective date of the renewal.
SEC. 58. Section 15060 of the Insurance Code is amended to read:
15060. The amount of fees prescribed by this chapter, unless
otherwise fixed, is that fixed in the following schedule:
(a) The application fee for the qualifying examination
for an original license is twenty-five dollars ($25).
(b) The application fee for an original branch office certificate
is fifteen dollars ($15).
(c) The fee for an original license application in the
amount equal to the renewal fee in effect on the last regular renewal
date before the date on which the license is issued, except that, if
the license will expire less than one year after its issuance, then
the fee is an amount equal to 50 percent of the renewal fee in effect
on the last regular renewal date before the date on which the
license is issued. The commissioner may, by appropriate
regulation, provide for the waiver or refund of the original licensee
fee where the license is issued less than 45 days before the date on
which it will expire.
(d) The renewal fee shall be fixed by the commissioner as follows:
(1) for a license as a public insurance adjuster, not more
than one hundred dollars ($100) (2) for a branch office certificate,
not more than twenty dollars ($20).
(1) For a license as a public insurance adjuster, not more than
one hundred dollars ($100).
(2) For a branch office certificate, not more than twenty dollars
($20).
(e) The application and license fee for applications prescribed by
the commissioner, in addition to those in this chapter, and the
application and license fee for a change in the type of business
organization of the licensee, shall be in the amount prescribed by
rule and regulation of the commissioner.
(f) The delinquency fee shall be 50 percent of the renewal fee in
effect on the date of expiration, but not more than
twenty-five dollars ($25). expiration.
(g) The fee for reexamination of an applicant is ten dollars
($10).
SEC. 59. Section 15062 of the Insurance Code is amended to read:
15062. Application or license fee fees
shall not be refunded except in accordance with
Section 158 of the Business and Professions Code.
pursuant to Section 1751.5.
SEC. 60. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.