Source: http://leginfo.legislature.ca.gov/faces/billCompareClient.xhtml?bill_id=201320140AB1391
Timestamp: 2020-02-23 18:26:11
Document Index: 405294546

Matched Legal Cases: ['art 2', 'art 2', 'art 2', 'art 2', 'art 2', 'art 2', 'art 1']

PDF2 PDF |Add To My Favorites | Version: 09/20/13 - Chaptered 08/28/13 - Enrolled 08/19/13 - Amended Senate 06/27/13 - Amended Senate 06/17/13 - Amended Senate 04/11/13 - Amended Assembly 04/03/13 - Amended Assembly 03/04/13 - Introduced
AB-1391 Insurance: omnibus.(2013-2014)
(a) An entity seeking to be licensed in this state as a risk retention group shall be organized under the laws of this state and licensed as a liability insurance company pursuant to Article 3 (commencing with Section 699) of Chapter 1 of Part 2.
(b) An entity that has not completed its chartering and licensing as a risk retention group in its domiciliary state is subject to the requirements of Article 8 (commencing with Section 820) of Chapter 1 of Part 2.
(c) In addition to the requirements of Article 3 (commencing with Section 699) of Chapter 1 of Part 2, a risk retention group licensed in this state shall submit to the commissioner a feasibility study or plan of operations and all other documentation required by the federal Liability Risk Retention Act of 1986 (15 U.S.C. Sec. 3901 et seq.) to be submitted by a risk retention group to a nonchartering state.
(d) In addition to the requirements of Article 3 (commencing with Section 699) of Chapter 1 of Part 2, a risk retention group licensed in this state shall comply with all of the following at the time of licensure, and thereafter:
(1) (A) The “board of directors” or “board,” as used in this section, means the governing body of the risk retention group elected by the shareholders or members to establish policy, elect or appoint officers and committees, and make other governing decisions.
(B) “Director,” as used in this section, means a natural person designated in the articles of the risk retention group, or designated, elected, or appointed by any other manner, name, or title to act as a director.
(2) (A) The board of directors of the risk retention group shall have a majority of independent directors. If the risk retention group is a reciprocal risk retention group, the attorney-in-fact shall be required to adhere to the same standards regarding independence of operation and governance as imposed on the risk retention group’s board of directors and subscribers’ advisory committee under these standards, and, to the extent permissible under this state’s laws, service providers of a reciprocal risk retention group shall contract with the risk retention group and not the attorney-in-fact.
(B) No director qualifies as “independent” unless the board of directors affirmatively determines that the director has no “material relationship” with the risk retention group. Each risk retention group shall disclose these determinations to its domestic regulator, at least annually. For this purpose, any person that is a direct or indirect owner of, or subscriber in, the risk retention group, or is an officer, director, or employee, or all three, of an owner and insured, as contemplated by 15 U.S.C. Section 3901(a)(4)(E)(ii) of the federal Liability Risk Retention Act of 1986, is considered to be “independent,” unless some other position of that officer, director, or employee constitutes a “material relationship.”
(C) “Material relationship” of a person with the risk retention group includes, but is not limited to, any of the following:
(i) The receipt in any one 12-month period of compensation or payment of any other item of value by that person, a member of that person’s immediate family, or any business with which that person is affiliated from the risk retention group or a consultant or service provider to the risk retention group that is greater than, or equal to, 5 percent of the risk retention group’s gross written premium for that 12-month period or 2 percent of its surplus, whichever is greater, as measured at the end of any fiscal quarter falling in a 12-month period. The person or immediate family member of that person is not independent until one year after his or her compensation from the risk retention group falls below the threshold.
(ii) A relationship with an auditor as follows: a director or an immediate family member of a director who is affiliated with, or employed in, a professional capacity by a present or former internal or external auditor of the risk retention group is not independent until one year after the end of the affiliation, employment, or auditing relationship.
(iii) A relationship with a related entity as follows: a director or immediate family member of a director who is employed as an executive officer of another company where any of the risk retention group’s present executives serve on that other company’s board of directors is not independent until one year after the end of that service or the employment relationship.
(3) The term of any material service provider contract with the risk retention group shall not exceed five years. Any contract, or its renewal, shall require the approval of the majority of the risk retention group’s independent directors. The risk retention group’s board of directors shall have the right to terminate any service provider, audit, or actuarial contracts at any time for cause after providing adequate notice as defined in the contract. The service provider contract is deemed material if the amount to be paid for that contract is greater than, or equal to, 5 percent of the risk retention group’s annual gross written premium or 2 percent of its surplus, whichever is greater.
(A) For purposes of this standard, “service providers” shall include captive managers, auditors, accountants, actuaries, investment advisers, attorneys, and managing general underwriters or any other party responsible for underwriting, determination of rates, collection of premium, adjusting and settling claims, or the preparation of financial statements. Any reference to “attorneys” does not include defense counsel retained by the risk retention group to defend claims, unless the amount of fees paid to those attorneys are “material” as referenced in this paragraph.
(B) A service provider contract meeting the definition of “material relationship” pursuant to paragraph (2) shall not be entered into unless the risk retention group has notified the commissioner in writing of its intention to enter into the transaction at least 30 days prior thereto, and the commissioner has not disapproved the transaction within that period.
(4) The risk retention group’s board of directors shall adopt a written policy in the plan of operation as approved by the board that requires the board to do all of the following:
(A) Ensure that all owners or insureds, or both, of the risk retention group receive evidence of ownership interest.
(B) Develop a set of governance standards applicable to the risk retention group.
(C) Oversee the evaluation of the risk retention group’s management, including, but not limited to, the performance of the captive manager, managing general underwriter, or other parties responsible for underwriting, determination of rates, collection of premium, adjusting or settling claims, or the preparation of financial statements.
(D) Review and approve the amount to be paid for all material service providers.
(E) Review and approve, at least annually, all of the following:
(i) The risk retention group’s goals and objectives relevant to the compensation of officers and service providers.
(ii) The officers’ and service providers’ performance in light of those goals and objectives.
(iii) The continued engagement of the officers and material service providers.
(5) The risk retention group shall have an audit committee composed of at least three independent board members as defined in paragraph (2). A nonindependent board member may participate in the activities of the audit committee, if invited by the members, but cannot be a member of that committee.
(A) The audit committee shall have a written charter that defines the committee’s purpose, which, at a minimum, shall be to do all of the following:
(i) Assist in board oversight of the integrity of the financial statements, the compliance with legal and regulatory requirements, and the qualifications, independence, and performance of the independent auditor and actuary.
(ii) Discuss the annual audited financial statements and quarterly financial statements with management.
(iii) Discuss the annual audited financial statements with its independent auditor and, if advisable, discuss its quarterly financial statements with its independent auditor.
(iv) Discuss policies with respect to risk assessment and risk management.
(v) Meet separately and periodically, either directly or through a designated representative of the committee, with management and independent auditors.
(vi) Review with the independent auditor any audit problems or difficulties and management’s response.
(vii) Set clear hiring policies of the risk retention group as to the hiring of employees or former employees of the independent auditor.
(viii) Require the external auditor to rotate the lead or coordinating audit partner having primary responsibility for the risk retention group’s audit as well as the audit partner responsible for reviewing that audit, so that neither individual performs audit services for more than five consecutive fiscal years.
(ix) Report regularly to the board of directors.
(B) If an audit committee is not designated by the insurer, the insurer’s entire board of directors shall constitute the audit committee.
(6) The board of directors shall adopt and disclose governance standards by making the information available through electronic means, such as posting the information on the risk retention group’s Internet Web site, or other means, and providing that information to members and insureds upon request. The information shall include all of the following:
(A) A process by which the directors are elected by the owners, insureds, or both.
(B) Director qualification standards.
(C) Director responsibilities.
(D) Director access to management and, as necessary and appropriate, independent advisers.
(E) Director compensation.
(F) Director orientation and continuing education.
(G) The policies and procedures that are followed for management succession.
(H) The policies and procedures that are followed for the annual performance evaluation of the board.
(7) The board of directors shall adopt and disclose a code of business conduct and ethics for directors, officers, and employees and promptly disclose to the board of directors any waivers of the code for directors or executive officers, including all of the following topics:
(A) Conflicts of interest.
(B) Matters covered under the corporate opportunity doctrine under the state of domicile.
(D) Fair dealing.
(E) Protection and proper use of risk retention group assets.
(F) Compliance with all applicable laws, rules, and regulations.
(G) Requiring the reporting of any illegal or unethical behavior that affects the operation of the risk retention group.
(8) The captive manager, president, or chief executive officer of the risk retention group shall promptly notify the domestic regulator, in writing, if he or she becomes aware of any material noncompliance with any of these governance standards.
(e) Domestic risk retention groups, licensed as of December 31, 2013, shall be governed by subdivision (d) on and after January 1, 2015.
(a) A notice of cancellation of a policy shall not be effective unless mailed or delivered by the insurer to the named insured, lienholder, or additional interest at least 20 days prior to the effective date of cancellation; provided, however, that where cancellation is for nonpayment of premium, at least 10 days’ notice of cancellation accompanied by the reason for the cancellation shall be given. Unless the reason accompanies or is included in the notice of cancellation, the notice of cancellation shall state or be accompanied by a statement that upon written request of the named insured, mailed or delivered to the insurer not less than 15 days prior to the effective date of cancellation, the insurer will specify the reason for the cancellation.
(b) This section shall not apply to nonrenewal.
(c) Notices made to lienholders pursuant to this section may be done electronically with the consent of the lienholder.
(a) “Adjusted RBC Report” means a Risk-Based Capital (RBC) report that has been adjusted by the commissioner in accordance with subdivision (b) or (c) of Section 739.2.
(b) “Corrective Order” means an order issued by the commissioner specifying corrective actions that the commissioner has determined are required.
(c) “Domestic insurer” means any life or health insurer or property and casualty insurer organized in this state.
(d) “Foreign insurer” means any life or health insurer or property and casualty insurer that is licensed to do business in this state but is not domiciled in this state.
(e) “Life or health insurer” means any admitted insurer issuing insurance subject to Part 2 (commencing with Section 10110) of Division 2, or a licensed property and casualty insurer writing only disability insurance.
(f) “NAIC” means the National Association of Insurance Commissioners.
(g) “Negative trend” means, with respect to a life or health insurer, a negative trend over a period of time, as determined in accordance with the “Trend Test Calculation” included in the RBC Instructions defined in subdivision (i).
(h) “Property and casualty insurer” means any admitted insurer writing insurance as described in Section 102, 103, 105, 107, 108, 109, 110, 111, 112, 113, 114, 115, 116, 118, 119.5, 119.6, or 120, but does not include monoline mortgage guaranty insurers, financial guaranty insurers, or title insurers.
(i) “RBC Instructions” means the RBC Report, including risk-based capital instructions adopted by the NAIC, and as the RBC Instructions may be amended by the NAIC from time to time in accordance with the procedures adopted by the NAIC.
(1) “Company Action Level RBC” means, with respect to any insurer, the product of 2.0 and its Authorized Control Level RBC.
(2) “Regulatory Action Level RBC” means the product of 1.5 and its Authorized Control Level RBC.
(3) “Authorized Control Level RBC” means the number determined under the risk-based capital formula in accordance with the RBC Instructions.
(4) “Mandatory Control Level RBC” means the product of .70 and the Authorized Control Level RBC.
(k) “RBC Plan” means a comprehensive financial plan containing the elements specified in subdivision (b) of Section 739.3. If the commissioner rejects the RBC Plan, and it is revised by the insurer, with or without the commissioner’s recommendation, the plan shall be called the “Revised RBC Plan.”
(l) “RBC Report” means the report required in Section 739.2.
(1) An insurer’s statutory capital and surplus.
(2) Other items, if any, that the RBC Instructions may provide.
(1) The filing of an RBC Report by an insurer that indicates any of the following:
(A) The insurer’s Total Adjusted Capital is greater than or equal to its Regulatory Action Level RBC but less than its Company Action Level RBC.
(B) If a life or health insurer, the insurer has Total Adjusted Capital that is greater than or equal to its Company Action Level RBC but less than the product of its Authorized Control Level RBC and 3.0, 2.5, and has a negative trend.
(C) If a property and casualty insurer, the insurer has Total Adjusted Capital that is greater than or equal to its Company Action Level RBC but less than the product of its Authorized Control Level RBC and 3.0, and triggers the trend test determined in accordance with the trend test calculation included in the Property and Casualty RBC instructions.
(2) The notification by the commissioner to the insurer of an Adjusted RBC Report that indicates the event in paragraph (1), provided that the insurer does not challenge the Adjusted RBC Report under Section 739.7.
(3) If the insurer challenges, under Section 739.7, an Adjusted RBC Report that indicates the event in paragraph (1), the notification by the commissioner to the insurer that the commissioner has, after a hearing, rejected the insurer’s challenge.
(b) In the event of a Company Action Level Event, the insurer shall prepare and submit to the commissioner a comprehensive financial plan that shall do all of the following:
(1) Identify the conditions in the insurer that contribute to the Company Action Level Event.
(2) Contain proposals of corrective actions that the insurer intends to take and would be expected to result in the elimination of the Company Action Level Event.
(3) Provide projections of the insurer’s financial results in the current year and at least the four succeeding years, both in the absence of proposed corrective actions and giving effect to the proposed corrective actions, including projections of statutory operating income, net income, capital, or surplus, or a combination. The projections for both new and renewal business may include separate projections for each major line of business and separately identify each significant income, expense, and benefit component.
(4) Identify the key assumptions impacting the insurer’s projections and the sensitivity of the projections to the assumptions.
(5) Identify the quality of, and problems associated with, the insurer’s business, including, but not limited to, its assets, anticipated business growth and associated surplus strain, extraordinary exposure to risk, mix of business, and use of reinsurance in each case, if any.
(c) The RBC Plan shall be submitted as follows:
(1) Within 45 days of the Company Action Level Event.
(2) If the insurer challenges an Adjusted RBC Report pursuant to Section 739.7, within 45 days after notification to the insurer that the commissioner has, after a hearing, rejected the insurer’s challenge.
(d) Within 60 days after the submission by an insurer of an RBC Plan to the commissioner, the commissioner shall notify the insurer whether the RBC Plan shall be implemented or is, in the judgment of the commissioner, unsatisfactory. If the commissioner determines that the RBC Plan is unsatisfactory, the notification to the insurer shall set forth the reasons for the determination, and may set forth proposed revisions that will render the RBC Plan satisfactory, in the judgment of the commissioner. Upon notification from the commissioner, the insurer shall prepare a Revised RBC Plan, which may incorporate by reference revisions proposed by the commissioner, and shall submit the Revised RBC Plan to the commissioner as follows:
(1) Within 45 days after the notification from the commissioner.
(2) If the insurer challenges the notification from the commissioner under Section 739.7, within 45 days after a notification to the insurer that the commissioner has, after a hearing, rejected the insurer’s challenge.
(e) In the event of a notification by the commissioner to an insurer that the insurer’s RBC Plan or Revised RBC Plan is unsatisfactory, the commissioner may, at his or her discretion, subject to the insurer’s right to a hearing under Section 739.7, specify in the notification that the notification constitutes a Regulatory Action Level Event.
(f) Every domestic insurer that files an RBC Plan or Revised RBC Plan with the commissioner shall file a copy of the RBC Plan or Revised RBC Plan with the insurance commissioner in any state in which the insurer is authorized to do business if both of the following apply:
(1) That state has an RBC provision substantially similar to subdivision (a) of Section 739.8.
(A) Fifteen days after the receipt of notice to file a copy of its RBC Plan or Revised RBC Plan with the state.
(B) The date on which the RBC Plan or Revised RBC Plan is filed under subdivision (c) of Section 739.7.
(a) On or after January 1, 1970, as used in this article and in subdivision (i) of Section 1011, “insolvency” means either of the following:
(a) That the person has refused to submit its books, papers, accounts, or affairs to the reasonable inspection of the commissioner or his or her deputy or examiner.
(b) That the person has neglected or refused to observe an order of the commissioner to make good within the time prescribed by law any deficiency in its capital if it is a stock corporation, or in its reserve if it is a mutual insurer.
(c) That the person, without first obtaining the consent in writing of the commissioner, has transferred, or attempted to transfer, substantially its entire property or business or, without consent, has entered into any transaction the effect of which is to merge, consolidate, or reinsure substantially its entire property or business in or with the property or business of any other person.
(d) That the person is found, after an examination, to be in a condition that makes its further transaction of business hazardous to its policyholders, or creditors, or to the public.
(e) That the person has violated its charter or any law of the state.
(f) That any officer of the person refuses to be examined under oath, touching its affairs.
(g) That any officer or attorney in fact of the person has embezzled, sequestered, or wrongfully diverted any of the assets of the person.
(h) That a domestic insurer does not comply with the requirements for the issuance to it of a certificate of authority, or that its certificate of authority has been revoked.
(i) That the last report of examination of any person to whom the provisions of this article apply shows the person to be insolvent within the meaning of Article 13 (commencing with Section 980) of Chapter 1 of Part 2 of Division 1; or if a reciprocal or interinsurance exchange, within the applicable provisions of Section 1370.2, 1370.4, 1371, or 1372; or if a life insurer, within the applicable provisions of Sections 10510 and 10511.
(j) Notification is given by the United States Secretary of the Treasury that a determination has been made by the secretary, in accordance with and satisfying the provisions of Section 5383(b) of Title 12 of the United States Code, as to a person described in Section 1010 that is an insurance company as defined in Section 5381(a)(13) of Title 12 of the United States Code, and one of the following:
(a) A superior court hearing shall be held in which the person may oppose the verified application solely on the grounds that the conditions set forth in subdivision (j) of Section 1101 do not exist. The hearing shall be completed within 24 hours after the verified application is filed with the court.
(b) The superior court shall issue an order as provided for in Section 1011 within 24 hours after the verified application was filed with the court.
(c) If the superior court does not issue an order within 24 hours as provided for in subdivision (b), then an order described in Section 1011 shall be deemed granted by operation of law upon expiration of the 24-hour period, without further notice.
(b) Notwithstanding subdivision (a), the court may issue an order to liquidate and wind up the business of a person as to whom a verified application is filed pursuant to subdivision (j) of Section 1011 based solely on the verified application and hearing as provided for in subdivision (a) of Section 1011.1, without further hearing, or may issue an order to liquidate and wind up the business of the person upon application by the commissioner after the issuance of an order under Section 1011. The court’s order may direct the winding up and liquidation of the business of the person by the commissioner, as liquidator, for the purpose of carrying out the order to liquidate and wind up the business of the person.
(a) “Accredited state” means a state in which the insurance department or regulatory agency having jurisdiction over the business of insurance has qualified as meeting the minimum financial regulatory standards promulgated and established from time to time by the National Association of Insurance Commissioners’ (NAIC) Financial Regulation Standards and Accreditation Program.
(b) “Control” or “controlled” has the meaning ascribed in Section 1215.
(c) “Controlled insurer” means an admitted insurer which is controlled, directly or indirectly, by a producer.
(d) “Controlling producer” means a producer who, directly or indirectly, controls an insurer.
(e) “Admitted insurer” or “insurer” means any person, firm, association, or corporation admitted to transact any property or casualty insurance business in this state. The following are not insurers for the purposes of this article:
(1) All residual market pools and joint underwriting authorities or associations.
(2) All captive insurers, other than risk retention groups as defined in the federal Superfund Amendments and Reauthorization Act of 1986 (42 U.S.C. Sec. 9671), the federal Liability Risk Retention Act of 1986 (15 U.S.C. Sec. 3901 et seq.), and the California Risk Retention Act of 1991 (Chapter 1.5 (commencing with Section 125) of Part 1). For the purposes of this article, captive insurers are either insurance companies which are owned by another organization and whose exclusive purpose is to insure risks of the parent organization and affiliated companies, or in the case of groups and associations, insurance organizations which are owned by the insureds and whose exclusive purpose is to insure risks of member organizations and group or association members and their affiliates.
(f) “Producer” means a fire and casualty licensee or licensees or any other person, firm, association, or corporation, when, for any compensation, commission, or other thing of value, the person, firm, association, or corporation acts or aids in any manner in soliciting, negotiating, negotiating or procuring the making of any insurance contract on behalf of an insured other than the person, firm, association, or corporation.
Section 1758.681 is added to the Insurance Code, to read:
(1) Establish marketing procedures to ensure assure that any comparison of policies by its agents or other producers will be fair and accurate.
(2) Establish marketing procedures to ensure assure excessive insurance is not sold or issued.
(2) High pressure tactics. Using Employing any method of marketing having the effect of or tending to induce the purchase of insurance through force, fright, threat, whether explicit or implied, or undue pressure to purchase or recommend the purchase of insurance.
(a) A disability insurer that covers hospital, medical, or surgical expenses under an individual health benefit plan as defined in subdivision (a) of Section 10198.6 may not, with respect to a federally eligible defined individual desiring to enroll in individual health insurance coverage, decline to offer coverage to, or deny enrollment of, the individual or impose any preexisting condition exclusion with respect to the coverage.
(b) For purposes of this section, “federally eligible defined individual” means an individual who, as of the date on which the individual seeks coverage under this section, meets all of the following conditions:
(1) Has had 18 or more months of creditable coverage, and whose most recent prior creditable coverage was under a group health plan, a federal governmental plan maintained for federal employees, or a governmental plan or church plan as defined in the federal Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1002).
(2) Is not eligible for coverage under a group health plan, Medicare, or Medi-Cal, and does not have other health insurance coverage.
(3) Was not terminated from his or her most recent creditable coverage due to nonpayment of premiums or fraud.
(4) If offered continuation coverage under COBRA or Cal-COBRA, has elected and exhausted that coverage.
(c) Every disability insurer that covers hospital, medical, or surgical expenses shall comply with applicable federal statutes and regulations regarding the provision of coverage to federally eligible defined individuals, including any relevant application periods.
(d) A disability insurer shall offer the following health benefit plans under this section that are designed for, made generally available to, are actively marketed to, and enroll, individuals: (1) either the two most popular products as defined in Section 300gg-41(c)(2) of Title 42 of the United States Code and Section 148.120(c)(2) of Title 45 of the Code of Federal Regulations or (2) the two most representative products as defined in Section 300gg-41(c)(3) of the United States Code and Section 148.120(c)(3) of Title 45 of the Code of Federal Regulations, as determined by the insurer in compliance with federal law. An insurer that offers only one health benefit plan to individuals, excluding health benefit plans offered to Medi-Cal or Medicare beneficiaries, shall be deemed to be in compliance with this chapter if it offers that health benefit plan contract to federally eligible defined individuals in a manner consistent with this chapter.
(e) (1) In the case of a disability insurer that offers health benefit plans in the individual market through a network plan, the insurer may do both of the following:
(A) Limit the individuals who may be enrolled under that coverage to those who live, reside, or work within the service area for the network plan.
(B) Within the service area covered by the health benefit plan, deny coverage to individuals if the insurer has demonstrated to the commissioner that the insured will not have the capacity to deliver services adequately to additional individual insureds because of its obligations to existing group policyholders, group contractholders and insureds, and individual insureds, and that the insurer is applying this paragraph uniformly to individuals without regard to any health status-related factor of the individuals and without regard to whether the individuals are federally eligible defined individuals.
(2) A disability insurer, upon denying health insurance coverage in any service area in accordance with subparagraph (B) of paragraph (1), may not offer health benefit plans through a network in the individual market within that service area for a period of 180 days after the coverage is denied.
(f) (1) A disability insurer may deny health insurance coverage in the individual market to a federally eligible defined individual if the insurer has demonstrated to the commissioner both of the following:
(A) The insurer does not have the financial reserves necessary to underwrite additional coverage.
(B) The insurer is applying this subdivision uniformly to all individuals in the individual market and without regard to any health status-related factor of the individuals and without regard to whether the individuals are federally eligible defined individuals.
(2) A disability insurer, upon denying individual health insurance coverage in any service area in accordance with paragraph (1), may not offer that coverage in the individual market within that service area for a period of 180 days after the date the coverage is denied or until the insurer has demonstrated to the commissioner that the insurer has sufficient financial reserves to underwrite additional coverage, whichever is later.
(g) The requirement pursuant to federal law to furnish a certificate of creditable coverage shall apply to health benefits plans offered by a disability insurer in the individual market in the same manner as it applies to an insurer in connection with a group health benefit plan policy or group health benefit plan contract.
(h) A disability insurer shall compensate an accident and health agent or a life and accident and health agent whose activities result in the enrollment of federally eligible defined individuals in the same manner and consistent with the renewal commission amounts as the insurer compensates accident and health agents or life and accident and health agents for other enrollees who are not federally eligible defined individuals and who are purchasing the same individual health benefit plan.
(i) Every disability insurer shall disclose as part of its COBRA or Cal-COBRA disclosure and enrollment documents, an explanation of the availability of guaranteed access to coverage under the federal Health Insurance Portability and Accountability Act of 1996, including the necessity to enroll in and exhaust COBRA or Cal-COBRA benefits in order to become a federally eligible defined individual.
(j) No disability insurer may request documentation as to whether or not a person is a federally eligible defined individual other than is permitted under applicable federal law or regulations.
(k) This section shall not apply to coverage defined as excepted benefits pursuant to Section 300gg(c) of Title 42 of the United States Code.
(l) This section shall apply to policies or contracts offered, delivered, amended, or renewed on or after January 1, 2001.
(m) (1) On and after January 1, 2014, and except as provided in paragraph (2), this section shall apply only to individual grandfathered health plans previously issued pursuant to this section to federally eligible defined individuals.
(2) If Section 5000A of the Internal Revenue Code, as added by Section 1501 of PPACA, is repealed or amended to no longer apply to the individual market, as defined in Section 2791 of the federal Public Health Service Act (42 U.S.C. Sec. 300gg-91), paragraph (1) shall become inoperative on the date of that repeal or amendment and this section shall apply to health benefit plans issued, amended, or renewed on or after that date.
(3) For purposes of this subdivision, the following definitions apply:
(A) “Grandfathered health plan” has the same meaning as that term is defined in Section 1251 of PPACA.
(B) “PPACA” means the federal Patient Protection and Affordable Care Act (Public Law 111-148), as amended by the federal Health Care and Education Reconciliation Act of 2010 (Public Law 111-152), and any rules, regulations, or guidance issued pursuant to that law.
(a) The commissioner, after a public hearing, shall approve or issue a reasonable plan for the equitable apportionment, among insurers admitted to transact liability insurance, of those applicants for automobile bodily injury and property damage liability insurance who are in good faith entitled to but are unable to procure that insurance through ordinary methods. The commissioner shall require the payment of one thousand four hundred ten dollars ($1,410), five hundred ninety dollars ($590), in advance, as a fee for the filing of amendments to the plan with the commissioner. The commissioner may approve or issue reasonable amendments to the plan that are approved by the plan’s advisory committee, if he or she first holds a public hearing to determine whether the amendments are in keeping with the intent and purpose of this section. All those insurers shall subscribe to the plan and its amendments and participate in the plan.
Section 12389.7 is added to the Insurance Code, to read:
(a) Sections 1070, 1070.5, 1070.6, 1071.5, 1072, and 1076 shall be applicable to underwritten title companies.
(b) The following terms from Sections 1070, 1070.5, 1070.6, 1071.5, 1072, and 1076 shall be applicable to underwritten title companies as follows:
(1) “Certificate of Authority” shall mean an underwritten title company license.
(2) “Insurer” shall mean an underwritten title company.
(3) “Reinsurer” shall mean a title underwriter or another underwritten title company.
(c) For the purposes of this section, Sections 1070, 1070.5, 1070.6, 1071.5, 1072, and 1076 shall be construed in accordance with the nature of underwritten title companies and the business of title insurance.