BILL NUMBER: SB 1302	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 19, 2016

INTRODUCED BY   Senator McGuire
   (Coauthors: Senators Berryhill and Roth)
   (  Coauthor:  Assembly Member 
 Dodd   Coauthors:   Assembly Members
  Bigelow,   Dodd,   and Maienschein 
)

                        FEBRUARY 19, 2016

   An act to amend  Sections 10095 and   Section
 10095.5 of  , and to amend, repeal, and add Section 10095
of,  the Insurance Code, relating to insurance, and declaring
the urgency thereof, to take effect immediately.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 1302, as amended, McGuire. Basic property insurance: California
FAIR Plan.
   Under existing law, the California FAIR (fair access to insurance
requirements) Plan Association is a joint reinsurance association of
state insurers that is established to, among other things, assist
persons in securing basic property insurance for qualified property
for which insurance cannot be obtained through the normal insurance
market. Existing law requires the association to establish and
maintain a toll-free telephone number through which a person may
receive assistance in applying for basic property insurance. Existing
law requires an insurer member of the plan to provide to an
applicant who is denied coverage the toll-free  telephone 
number for the plan for information and assistance in obtaining basic
property insurance. Existing law requires an agent or broker
transacting basic property insurance to either assist a person in
making an application for insurance through the plan or to provide
the person with that toll-free telephone number.
   This bill would additionally require the association to establish
and maintain an Internet Web site at which a person may receive
information and assistance in applying for insurance through the
 plan.   plan and would require the association
to include the toll-free telephone number and the Internet Web site
address on all communications with an applicant or an insured. 
The bill  , beginning March 1, 2017,  would require an
insurer member to provide an applicant denied coverage or a
policyholder whose policy is canceled or not renewed both that
Internet Web site address and toll-free telephone number. 
The bill would require the association to cause that toll-free
telephone number and Internet Web site address to be included in all
communications with an applicant or insured. The bill would require
an insurance agent or broker transacting basic property insurance to
assist a person in making an application for insurance through the
plan, and would delete the provision that permitted the agent or
broker, as an alternative, to provide the person the toll-free
telephone number.   The bill would delete the provision
permitting an agent or broker to provide the toll-free telephone
number of the plan as an alternative to assisting a person in making
an application for insurance through the plan, and would instead
require an agent or broker to   assist a person in making an
application through the plan by submitting an application at the
person's request or by providing the person with the California FAIR
Plan's Internet Web site address and the toll-free telephone number.

   This bill would declare that it is to take effect immediately as
an urgency statute.
   Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 10095 of the Insurance Code is amended to read:

   10095.  (a) Within 30 days following the effective date of this
chapter, the association shall submit to the commissioner, for his or
her review, a proposed plan of operation, consistent with the
provisions of this chapter, creating an association consisting of all
insurers licensed to write and engaged in writing in this state, on
a direct basis, basic property insurance or any component of basic
property insurance in homeowners or other dwelling multiperil
policies. An insurer described in this subdivision shall be a member
of the association and shall remain a member as a condition of its
authority to transact those kinds of insurance in this state.
   (b) The proposed plan shall authorize the association to assume
and cede reinsurance on risks written by insurers in conformity with
the program.
   (c) Under the plan, an insurer shall participate in the writings,
expenses,  and  profits and losses of the association in the
proportion that its premiums written during the second preceding
calendar year bear to the aggregate premiums written by all insurers
in the program, excluding that portion of the premiums written
attributable to the operation of the association. Premiums written on
a policy of basic residential earthquake insurance issued by the
California Earthquake Authority pursuant to Section 10089.6 shall be
attributed to the insurer that writes the underlying policy of
residential property insurance.
   (d) The plan shall provide for administration by a governing
committee under rules to be adopted by the governing committee with
the approval of the commissioner. Voting on administrative questions
of the association and facility shall be weighted in accordance with
each insurer's premiums written during the second preceding calendar
year as disclosed in the reports filed by the insurer with the
commissioner.
   (e) The plan shall provide for a plan to encourage persons to
secure basic property insurance through normal channels from an
admitted insurer or a licensed surplus line broker by informing those
persons what steps they must take in order to secure the insurance
through normal channels.
   (f) The plan shall be subject to the approval of the commissioner
and shall go into effect upon the tentative approval of the
commissioner. The commissioner may, at any time, withdraw his or her
tentative approval or he or she may, at any time after he or she has
given his or her final approval, revoke that approval if he or she
feels it is necessary to carry out the purposes of the chapter. The
withdrawal or revocation of that approval shall not affect the
validity of any policies executed prior to the date of the
withdrawal. If the commissioner disapproves or withdraws or revokes
his or her approval to all or any part of the plan of operation, the
association shall, within 30 days, submit for review an appropriately
revised plan or part of a revised plan, and, if the association
fails to do so, or if the revised plan is unacceptable, the
commissioner shall promulgate a plan of operation or part of a plan
as he or she may deem necessary to carry out the purposes of this
chapter.
   (g) The association may, on its own initiative or at the request
of the commissioner, amend the plan of operation, subject to approval
by the commissioner, who shall have supervision of the inspection
bureau, the  facility   facility,  and the
association. The commissioner or any person designated by him or her,
shall have the power of visitation of and examination into the
operation and free access to all the books, records, files, papers,
and documents that relate to operation of the facility and
association, and may summon, qualify, and examine as witnesses all
persons having knowledge of those operations, including officers,
agents, or employees thereof. 
   (h) An insurer member of the plan shall provide to an applicant
who is denied coverage, or a policyholder whose policy is canceled or
not renewed, the Internet Web site address and statewide toll-free
telephone number for the plan established pursuant to Section 10095.5
for the purpose of obtaining information and assistance in obtaining
basic property insurance.  
   (h) Every insurer member of the plan shall provide to applicants
who are denied coverage the statewide toll-free telephone number for
the plan established pursuant to Section 10095.5 for the purpose of
obtaining information and assistance in obtaining basic property
insurance.  
   (i) This section shall remain in effect only until March 1, 2017,
and as of that date is repealed, unless a later enacted statute, that
is enacted before March 1, 2017, deletes or extends that date. 

   SEC. 2.    Section 10095 is added to the  
Insurance Code   , to read:  
   10095.  (a) Within 30 days following the effective date of this
chapter, the association shall submit to the commissioner, for his or
her review, a proposed plan of operation, consistent with the
provisions of this chapter, creating an association consisting of all
insurers licensed to write and engaged in writing in this state, on
a direct basis, basic property insurance or any component of basic
property insurance in homeowners or other dwelling multiperil
policies. An insurer described in this subdivision shall be a member
of the association and shall remain a member as a condition of its
authority to transact those kinds of insurance in this state.
   (b) The proposed plan shall authorize the association to assume
and cede reinsurance on risks written by insurers in conformity with
the program.
   (c) Under the plan, an insurer shall participate in the writings,
expenses, and profits and losses of the association in the proportion
that its premiums written during the second preceding calendar year
bear to the aggregate premiums written by all insurers in the
program, excluding that portion of the premiums written attributable
to the operation of the association. Premiums written on a policy of
basic residential earthquake insurance issued by the California
Earthquake Authority pursuant to Section 10089.6 shall be attributed
to the insurer that writes the underlying policy of residential
property insurance.
   (d) The plan shall provide for administration by a governing
committee under rules to be adopted by the governing committee with
the approval of the commissioner. Voting on administrative questions
of the association and facility shall be weighted in accordance with
each insurer's premiums written during the second preceding calendar
year as disclosed in the reports filed by the insurer with the
commissioner.
   (e) The plan shall provide for a plan to encourage persons to
secure basic property insurance through normal channels from an
admitted insurer or a licensed surplus line broker by informing those
persons what steps they must take in order to secure the insurance
through normal channels.
   (f) The plan shall be subject to the approval of the commissioner
and shall go into effect upon the tentative approval of the
commissioner. The commissioner may, at any time, withdraw his or her
tentative approval or he or she may, at any time after he or she has
given his or her final approval, revoke that approval if he or she
feels it is necessary to carry out the purposes of the chapter. The
withdrawal or revocation of that approval shall not affect the
validity of any policies executed prior to the date of the
withdrawal. If the commissioner disapproves or withdraws or revokes
his or her approval to all or any part of the plan of operation, the
association shall, within 30 days, submit for review an appropriately
revised plan or part of a revised plan, and, if the association
fails to do so, or if the revised plan is unacceptable, the
commissioner shall promulgate a plan of operation or part of a plan
as he or she may deem necessary to carry out the purposes of this
chapter.
   (g) The association may, on its own initiative or at the request
of the commissioner, amend the plan of operation, subject to approval
by the commissioner, who shall have supervision of the inspection
bureau, the facility, and the association. The commissioner or any
person designated by him or her, shall have the power of visitation
of and examination into the operation and free access to all the
books, records, files, papers, and documents that relate to operation
of the facility and association, and may summon, qualify, and
examine as witnesses all persons having knowledge of those
operations, including officers, agents, or employees thereof.
   (h) An insurer member of the plan shall provide to an applicant
who is denied coverage, or a policyholder whose policy is canceled or
not renewed, the Internet Web site address and statewide toll-free
telephone number for the plan established pursuant to Section 10095.5
for the purpose of obtaining information and assistance in obtaining
basic property insurance.
   (i) This section shall become operative March 1, 2017. 
   SEC. 2.   SEC. 3.   Section 10095.5 of
the Insurance Code is amended to read:
   10095.5.  (a) The association shall establish and maintain an
Internet Web site and a statewide toll-free telephone number through
which a person may receive information and assistance in applying for
insurance through the plan. The association shall cause the
toll-free telephone number to be published in all general
distribution telephone directories in the state and shall include the
toll-free telephone  number  and Internet Web site address
on all communications with an applicant or insured.
   (b) An insurance agent or broker transacting basic property
insurance shall assist a person in making an application for
insurance through the  plan.  plan by submitting
an application at the person's request or by providing the person
with the California FAIR Plan's Internet Web site address and the
toll-free telephone number. 
   SEC. 3.   SEC. 4.   This act is an
urgency statute necessary for the immediate preservation of the
public peace, health, or safety within the meaning of Article IV of
the Constitution and shall go into immediate effect. The facts
constituting the necessity are:
   In order to have the consumer protections proposed in this act
become operative as soon as possible for homeowners who are having
difficulty obtaining insurance coverage for their property because
they are located in high-risk brush and wildfire areas, and to
provide insurers adequate time to amend and prepare their required
notices to customers about the availability of coverage through the
 California  FAIR (fair access to insurance requirements)
Plan, it is necessary for this act to take effect immediately.