AB 1472,
as amended, Committee on Budget. begin deleteBudget Act of 2014. end deletebegin insertProperty insurance: Seismic Safety Account.end insert
Existing law created the Seismic Safety Account as a special account within the Insurance Fund with the funds to be distributed, upon appropriation, to the Alfred E. Alquist Seismic Safety Commission for the support of the commission and to the Department of Insurance for the actual administrative costs incurred in collecting the assessments. In order to fund the account, an assessment, as specified, is imposed on each person who owns real property, commercial or residential, that is covered by a property insurance policy.
end insertbegin insertThis bill would extend that assessment to each person who rents or leases real property, commercial or residential, that is covered by a property insurance policy.
end insertbegin insertThis bill would declare that it is to take effect immediately as an urgency statute.
end insertThis bill would express the intent of the Legislature to enact statutory changes relating to the Budget Act of 2014.
end deleteVote: begin deletemajority end deletebegin insert2⁄3end insert.
Appropriation: no.
Fiscal committee: begin deleteno end deletebegin insertyesend insert.
State-mandated local program: no.
The people of the State of California do enact as follows:
begin insertSection 12975.9 of the end insertbegin insertInsurance Codeend insertbegin insert is amended
2to read:end insert
(a) The Seismic Safety Account is hereby created as
4a special account within the Insurance Fund. Moneys in the account
5are available, upon appropriation by the Legislature, for the
6purposes of this section to fund the department and the Alfred E.
7Alquist Seismic Safety Commission.
8(b) There is hereby imposed an assessment on each person who
9ownsbegin insert, rents, or leasesend insert real property, commercial or residential,
10that is insured by a property insurance policy. The department
11shall calculate the annual assessment to be charged to each
12commercial and residential earned property exposure. The
13assessment shall be set annually every August 1, beginning August
141, 2014,
for all commercial and residential earned property
15exposures reported during the previous calendar year. The annual
16assessment shall be set at fifteen cents ($0.15) per earned property
17exposure for the first three years of the implementation of this
18section. Each year thereafter, the annual assessment shall be based
19upon the number of earned property exposures from both
20commercial and residential insurance policies, the amount required
21for the support of the Alfred E. Alquist Seismic Safety
22Commission, the actual collection and administrative costs of the
23department, and the maintenance of an adequate reserve, but shall
24not exceed fifteen cents ($0.15) per earned property exposure.
25(c) The insurer, upon receipt of an invoice from the department,
26shall transmit payment to the department for deposit into the
27Seismic Safety Account. The insurer shall recover the assessment
28from the insured, unless the insurer elects to pay the assessment
29on the
insured’s behalf. The insurer may provide a description of
30the assessment to the insured as part of its billing statement. Any
31deficiency or excess in the amount collected in relation to the
32appropriation authority for the commission and the department
33shall be accounted for in the subsequent annual fee calculation.
P3 1Any balance remaining in the Seismic Safety Account at the end
2of each fiscal year shall be retained in the account and carried
3forward to the next fiscal year.
4(d) Funds in the Seismic Safety Account shall be distributed,
5upon appropriation by the Legislature, to the Alfred E. Alquist
6Seismic Safety Commission for the support of the commission
7and to the department for the actual administrative costs incurred
8in collecting the assessments.
9(e) Any assessment collected from an insured that has not been
10remitted to the department shall be a debt owed to the state by the
11
insurer. This part does not impose any obligation upon an insurer
12to take any legal action to enforce the collection of the assessment
13imposed by this section.
14(f) Payment of the assessment shall be considered delinquent
15if not paid within 45 days of the invoice date. The department is
16authorized to charge a late fee of 1.5 percent per month of the
17balance due, compounded monthly, for any amount not paid within
18this period in accordance with Section 12995.
19(g) (1) Notwithstanding Section 10231.5 of the Government
20Code, the department shall report by December 1 of each year,
21beginning on December 1, 2014, to the Legislature, the Alfred E.
22Alquist Seismic Safety Commission, and the Department of
23Finance on the assessment calculation methodology employed.
24(2) A report to be submitted to the Legislature pursuant to this
25
subdivision shall be submitted in compliance with Section 9795
26of the Government Code.
This act is an urgency statute necessary for the
28immediate preservation of the public peace, health, or safety within
29the meaning of Article IV of the Constitution and shall go into
30immediate effect. The facts constituting the necessity are:
31In order to protect the public from the continuing threat of loss
32of life and property damage due to earthquakes, it is necessary
33that this act take effect immediately.
It is the intent of the Legislature to enact statutory
35changes relating to the Budget Act of 2014.
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