BILL NUMBER: AB 2297	CHAPTERED  09/29/00

	CHAPTER   884
	FILED WITH SECRETARY OF STATE   SEPTEMBER 29, 2000
	APPROVED BY GOVERNOR   SEPTEMBER 28, 2000
	PASSED THE ASSEMBLY   AUGUST 30, 2000
	PASSED THE SENATE   AUGUST 29, 2000
	AMENDED IN SENATE   AUGUST 25, 2000
	AMENDED IN SENATE   JULY 3, 2000
	AMENDED IN ASSEMBLY   MAY 16, 2000
	AMENDED IN ASSEMBLY   MAY 2, 2000

INTRODUCED BY   Assembly Member Calderon

                        FEBRUARY 24, 2000

   An act to amend Sections 11664 and 11750 of the Insurance Code,
relating to workers' compensation, and declaring the urgency thereof,
to take effect immediately.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2297, Calderon.  Insurance:  workers' compensation:  renewal
notice.
   Existing law requires a notice of nonrenewal at least 30 days, but
not more than 120 days, in advance of the end of the policy period
of a policy of workers' compensation except for 6 specified
situations, including when the insurer has made a written offer to
the insured to renew the policy at a premium rate increase of less
than 25%.  Existing law does not define the term "premium rate."
   This bill would require an insurer, if the premium rate charged on
a workers' compensation policy is to be increased by 25% or more, to
provide the policyholder with written notice of a renewal offer not
less than 30 days before the policy renewal date.  The bill would
define the term "premium rate" for purposes of the renewal
notification requirements.
   Existing law provides for an advisory organization, as defined, to
provide the Insurance Commissioner with advisory pure premium rates
for workers' compensation insurance and for employers liability
insurance incidental thereto and written in connection therewith.
   This bill would require that within 60 days of receiving an
advisory pure premium rate filing the Insurance Commissioner hold a
public hearing, and within 30 days of its conclusion, approve,
disapprove, or modify the proposed rate.
   This bill would declare that it is to take effect immediately as
an urgency statute.


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


  SECTION 1.  Section 11664 of the Insurance Code is amended to read:

   11664.  (a) This section applies only to policies of workers'
compensation insurance.
   (b) A notice of nonrenewal shall be in writing and shall be
delivered or mailed to the producer of record and to the named
insured at the mailing address shown on the policy.  Subdivision (a)
of Section 1013 of the Code of Civil Procedure shall be applicable if
the notice is mailed.
   (c) An insurer, at least 30 days, but not more than 120 days, in
advance of the end of the policy period, shall give notice of
nonrenewal, and the reasons for the nonrenewal, if the insurer
intends not to renew the policy.
   (d) If an insurer fails to give timely notice required by
subdivision (c), the policy of insurance shall be continued, with no
change in its premium rate, for a period of 60 days after the insurer
gives the notice.
   (e) A notice of nonrenewal shall not be required in any of the
following situations:
   (1) The transfer of, or renewal of, a policy without a change in
its terms or conditions or the rate on which the premium is based
between insurers that are members of the same insurance group.
   (2) The policy has been extended for 90 days or less, if the
notice required in subdivision (c) has been given prior to the
extension.
   (3) The named insured has obtained replacement coverage or has
agreed, in writing, within 60 days of the termination of the policy,
to obtain that coverage.
   (4) The policy is for a period of no more than 60 days and the
insured is notified at the time of issuance that it may not be
renewed.
   (5) The named insured requests a change in the terms or conditions
or risks covered by the policy within 60 days prior to the end of
the policy period.
   (6) The insurer has made a written offer to the insured to renew
the policy at a premium rate increase of less than 25 percent.
   (A) If the premium rate in the governing classification for the
insured is to be increased 25 percent or greater and the insurer
intends to renew the policy, the insurer shall provide a written
notice of a renewal offer not less than 30 days prior to the policy
renewal date. The governing classification shall be determined by the
rules and regulations established in accordance with subdivision (c)
of Section 11750.3.
   (B) For purposes of this section, "premium rate" means the cost of
insurance per unit of exposure prior to the application of
individual risk variations based on loss or expense considerations
such as scheduled rating and experience rating.
   (f) After an insured has received a notice of nonrenewal, upon
receiving a written request from the insured or the agent or broker
of record on the nonrenewed policy, an insurer shall provide a
premium and loss history report for the account's tenure or the past
three years, whichever is shorter, plus loss experience during the
current policy year, within 10 business days of receiving the
request.
  SEC. 2.  Section 11750 of the Insurance Code is amended to read:
   11750.  (a) The purpose of this article is to promote the public
welfare by regulating concert of action between insurers in
collecting and tabulating rating information and other data that may
be helpful in the making of adequate pure premium rates for workers'
compensation insurance and for employers liability insurance
incidental thereto and written in connection therewith for all
admitted insurers and in submitting them to the commissioner for
approval; to authorize and regulate the existence and cooperation of
qualified rating organizations to one of which each workers'
compensation insurer shall belong; to authorize and regulate
cooperation between insurers, rating organizations and advisory
organizations in ratemaking and other related matters to the end that
the purposes of this chapter may be complied with and carried into
effect.
   (b) Notwithstanding any other provision of law, within 60 days of
receiving an advisory pure premium rate filing made pursuant to
subdivision (b) of Section 11750.3, the Insurance Commissioner shall
hold a public hearing, and within 30 days of the conclusion of the
hearing, approve, disapprove, or modify the proposed rate.
  SEC. 3.  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 ensure that employers begin to receive clear
notification as soon as possible on whether their workers'
compensation insurance rates are being increased or their policies
are being canceled, it is necessary for this act to take effect
immediately.