BILL ANALYSIS                                                                                                                                                                                                    �






                             SENATE INSURANCE COMMITTEE
                           Senator Ronald Calderon, Chair


          SB 711 (Committee on Insurance) Hearing Date:  April 27, 2011  

          As Introduced: February 18, 2011
          Fiscal:             No
          Urgency:       No
          

           SUMMARY    Would codify the uncodified "prospective-only 
          application" provision of last session's SB 1408 and delete an 
          erroneous cross-reference.
          
           DIGEST
            
          Existing law

              1.   Provides a mechanism, within the California Life and 
               Health Insurance Guarantee Association (CLHIGA) Act, for 
               the payment of claims against insolvent life and health 
               insurance companies if the claims arise under qualifying 
               insurance policies.

             2.   Authorizes coverage for qualified persons under direct, 
               nongroup life, health, annuity and supplemental policies, 
               and contracts and includes special provisions pertaining to 
               annuity contracts, and certificates under group annuity 
               contracts, as defined

           
          This bill

              1.   Places in the CLIHIGA law an uncodified provision 
               included in SB 1408 (See Section 16) which was signed into 
               law last year as Chapter 334 Statutes of 2010. The 
               uncodified provision made the app;lication of SB 1408 
               prospective only by stating that the amendments made to the 
               California Life and Health Insurance Guarantee Association 
               Act by SB 1408 shall not apply to any member insurer that, 
               before the effective date of this act, has been placed 
               under an order of liquidation with a finding of insolvency.

             2.   Strikes a single erroneous cross-reference to a 
               provision no longer in the law.




                                                                      SB 
          711 (Committee on Insurance), Page 2




           COMMENTS

          1.  Purpose of the bill  : This bill is a clean-up measure to SB 
              1408 of 2010.

           2.  Background and Discussion:  

               a.     This measure is non-controversial clean-up of last 
                 year's SB 1408.

           3.  Summary of Arguments in Support:   

               a.     The only effect of codifying SB 1408's "prospective 
                 application" provision is a practical one - it 
                 facilitates the ability of legal researcher's to find and 
                 identify SB 1408's  provision which made it's 2010 
                 changes prospective-only in their application.

           4.  Summary of Arguments in Opposition:    

               a.     None
                

          5.  Amendments:  

               a.     None  

          6.  Prior and Related Legislation:   

            a.  SB 1408 of 2010 (Chapter  334 Statutes of 2010) updated 
              California's Life and Health Insurance Guaranty Association 
              law to reflect recent National Association of Insurance 
              Commissioners (NAIC) model act revisions.


           
          LIST OF REGISTERED SUPPORT/OPPOSITION
          
          Support
           
          Association of California Life and Health Insurance Companies 
          (ACLHIC)
          Pacific Life Insurance Company
          California Life and Health Guarantee association 
           




                                                                      SB 
          711 (Committee on Insurance), Page 3



          Opposition
               
          None

          Consultant: Ken Cooley  (916) 651-4110