BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  AB 1098
                                                                  Page  1

          Date of Hearing:   May 4, 2011

                           ASSEMBLY COMMITTEE ON INSURANCE
                                 Jose Solorio, Chair
                    AB 1098 (Hagman) - As Amended:  March 31, 2011
           
          SUBJECT  :   Insurance: unlawful practices

           SUMMARY  :  Requires a certain request by the Department of 
          Insurance (DOI) to be made in writing.  Specifically,  this bill  
          would require an insurer, upon the written request by the DOI, 
          to disclose to the DOI that it has denied a registered auto body 
          repair shop from participating in the insurer's direct repair 
          program.

           EXISTING LAW  :

          1)Permits a registered auto body repair shop that is denied 
            participation in an insurer's direct repair program to report 
            a denial to the Department of Insurance (DOI), which must 
            maintain a record of all those denials for the purposes of 
            gathering market conduct information.

          2)Requires an insurer, upon the request of the DOI, to disclose 
            the fact that a denial was made.

           FISCAL EFFECT  :   Undetermined.

           COMMENTS  :   

           1)Purpose  .  The purpose of this bill is to require the written 
            request of the DOI to the insurer to disclose the denial of a 
            registered auto body repair shop to participate in an 
            insurer's direct repair program.

           2)Background  .  Existing law does not require that the Department 
            make this request in writing.  The author states that the 
            denial of entry into a program is a private action between the 
            shop and the carrier.

           3)Support.   The author states that in order to protect privacy 
            rights the carriers need written documentation from DOI.  The 
            Personal Insurance Federation of California states that a 
            written request will ensure that the person to whom the 
            carriers release the information has the authority to receive 








                                                                  AB 1098
                                                                  Page  2

            it.  A telephone call is not sufficiently protective because 
            there is no ability to verify the caller.  
           
           REGISTERED SUPPORT / OPPOSITION  :   

           Support 
           
          Personal Insurance Federation of California

           Opposition 
           None received
           
          Analysis Prepared by  :    Manny Hernandez / INS. / (916) 319-2086