Amended in Senate March 28, 2016

Senate Bill No. 1371

Introduced by Senator Galgiani

February 19, 2016

begin delete An act to add Section 19329 to the Education Code, relating to the State Library. end delete begin insert An act to amend Section 22315 of the Financial Code, relating to consumer loans. end insert

LEGISLATIVE COUNSEL’S DIGEST

SB 1371, as amended, Galgiani. begin delete State Library: online homework assistance. end delete begin insert Credit disability insurance: premium payments. end insert

begin insert

The California Finance Lenders Law generally provides for the licensure and regulation of finance lenders and brokers by the Commissioner of Business Oversight, and makes a willful violation of its provisions a crime. The law authorizes a licensee to offer credit disability insurance under specified conditions and requires premiums to be made available on a monthly or annual premium basis.

end insert begin insert

This bill would instead authorize credit disability insurance to be offered on a monthly, annual, or single premium basis. The bill would require, when a monthly premium is offered, the premium rate charged per month to not exceed a pro rata relationship to the annual or single premium.

end insert begin delete

Under existing law, there is in the State Department of Education a division known as the California State Library. The State Librarian is authorized to give advisory, consultive, and technical assistance with respect to public libraries to librarians and library authorities and assist all other authorities, state and local, in assuming their full responsibility for library services. The department is authorized to contract with counties, cities, or districts within this state, agencies of the state, and agencies of the United States Government for the purpose of providing library services and to establish and operate library service centers.

end delete begin delete

This bill would, subject to an appropriation of funds for that purpose, require the State Librarian to enter into a contract with an entity to establish and maintain a program of online homework assistance through the public libraries in the state. The program would be required to be made available free of charge to all pupils in the state.

end delete

Vote: majority. Appropriation: no. Fiscal committee:  begin delete yes end delete begin insert no end insert . State-mandated local program: no.

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

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begin insert SECTION 1. end insert   

end insert

begin insert Section 22315 of the end insert begin insert Financial Code end insert begin insert is amended
to read: end insert

22315.  

(a) Credit disability insurance written pursuant to
Section 22314 shall not provide indemnity against the risk that the
borrower will become disabled for a period of less than 14 days.
The insurance may provide indemnity for any single period of
continuous disability of 14 days or longer, after which the risk
may become compensable. The insurance may be offered with
retroactive coverage to an earlier date based upon the disability
having continued for a period stated in the policy, but if insurance
with retroactive coverage is offered, it shall also be offered without
retroactive coverage, and the premium rate for each coverage shall
be separately stated in writing to the borrower.

(b) If insurance with retroactive coverage is provided, the
coverage shall provide for a prorated payment based upon the
fraction of the month during which the insured is disabled, provided
that the insured is continuously disabled during the waiting period
set forth in the policy. If insurance without retroactive coverage
is provided, the coverage shall provide for a prorated payment
based upon the fraction of the month during which the insured is
disabled, after first excluding the elimination period set forth in
the policy. For the purpose of this subdivision, a month is any
period of 30 consecutive days.

(c) Credit disability insurance, if made available by a licensee,
shall be available on a begin delete monthly end delete begin insert monthly, annual, end insert or begin delete annual end delete begin insert single end insert
premium begin delete basis, and end delete begin insert basis. When a monthly premium is offered, end insert
the premium begin delete by the end delete begin insert rate charged per end insert month shall not exceed a pro
rata relationship to the annual begin insert or single end insert premium. Credit disability
insurance need not be offered for a period less than the term of the
loan to which it is applicable, and no credit disability insurance
shall be written for a period in excess of the term of the loan to
which it is applicable.

(d) The monthly disability benefit payable with respect to an
open-end loan shall not exceed the monthly payment computed
pursuant to Section 22453 on the outstanding balance at the time
disability is incurred.

This section does not apply to any loan of a bona fide principal
amount of ten thousand dollars ($10,000) or more, as determined
in accordance with Section 22251.

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SECTION 1.  

Section 19329 is added to the Education Code,
to read:

19329.  

Subject to an appropriation of funds for this purpose
in the annual Budget Act or other statute, the State Librarian shall
enter into a contract with an entity to establish and maintain a
program of online homework assistance through the public libraries
in the state. The program shall be made available free of charge
to all pupils in the state.

end delete

begin delete

SEC. 2.  

Subject to an appropriation of funds in the annual
Budget Act or other statute or the availability of other funds, the
sum of three million dollars ($3,000,000) shall be granted annually
to the State Librarian for purposes of establishing and maintaining
a program of online homework assistance, as set forth in Section
19329 of the Education Code.

end delete