California Legislative Round Up

The following is the Association of California Insurance Company’s weekly update on legislative action taken on insurance-related bills
last week and the measures scheduled for consideration this week.

Bills heard last week:

Senate Judiciary Committee – June 14

AB 446 (Negrete McLeod) Licensees: settlements agreements. AB 446 would prohibit any licensee regulated by a board, bureau or program within the Department of Consumer Affairs (DCA) from including a provision in the settlement of a civil action that 1) prohibits the other party from contacting, filing a complaint with or cooperating with DCA; or 2) requires the other party to withdraw complaint from DCA. AB 446 was withdrawn from Senate Judiciary Committee and sent to Senate Appropriations Committee for consideration at a later date. ACIC is watching the bill.

AB 1133 (Harman) Evidentiary Privileges. Under current law, the Evidence Code provides a privilege against disclosure of confidential information unless the privilege is waived by any holder of the privilege without coercion. AB 1133 would provide that the waiver of the privilege arises only when the holder has intentionally released a significant part of confidential information. The waiver cannot be accidental or inadvertent. Judiciary Committee hearing canceled at the request of the author. ACIC supports the bill.

AB 1351 (Vargas) Office of Administrative Law: Regulations. AB 1351 would establish a process in the Office of Administrative Law for the purpose of investigating state agency use and enforcement of rules and regulations that have not been adopted pursuant to the Administrative Procedure Act (i.e. underground regulations). Assembly Judiciary Committee hearing postponed to June 28. ACIC supports the bill.

Senate Banking, Finance and Insurance Committee – June 15
AB 778 (Mullin) Auto Insurance: In-Home Supportive Services. AB 778 would prohibit an automobile liability insurance policy from containing a provision that excludes from coverage the policyholder’s use of the vehicle for performing in-home support ervices. AB 778 would also prohibit n insurer from declining, rating or canceling a policy on the basis that the insured is using the insured vehicle to provide transportation incidental to the provision of in-home supportive services. Approved 8 to 3 by Senate Banking, Finance and Insurance Committee. Will be considered next by the full Senate. ACIC opposes the bill.

AB 1043 (Harman) Insurance: Unearned Premium. AB 1043 would require all types of insurance policies to be subject to the same requirements for accounting for unearned premiums. AB 1043 would require an insurer – upon request of the agent/broker or insured — to provide an explanation of the accounting of the premium refund. Senate Judiciary Committee hearing postponed to June 29. ACIC is watching the bill.

AB 1120 (Benoit) Auto Insurance: Assigned Risk Plans. AB 1120 would change the premium levels that are used as criteria for appointments of insurers to the Advisory Committee of the California Automobile Assigned Risk Plan. Senate Judiciary Committee hearing postponed until later date. ACIC is watching the bill.

Bills to be heard this week:

Assembly Judiciary Committee – June 21

SB 399 (Escutia) Health care liens. SB 399 would allow public hospitals to file liens against judgments obtained by Medi-Cal recipients against third parties whose negligence caused the injury. The hospital would be entitled to a lien in an amount necessary to cover its “reasonable and necessary charges” even if those charges exceed the Medi-Cal reimbursement paid to the hospital as full payment for the care. ACIC opposes SB 399.

SB 852 (Bowen) Identify Theft. SB 852 would amend California’s law requiring notification to consumers whose private information is accessed by unauthorized sources and would extend the law to include “hard copy” types of documents such as old-fashioned manila files. ACIC opposes the bill.

Assembly Insurance Committee – June 22

SB 538 (Kuehl) Workers’ Compensation: Medical Provider Networks. SB 538 would establish statutory standards for medical provider networks. SB 538 would also require a health care organization that serves as a medical provider network to demonstrate that it has sufficient capacity to provide services to workers’ compensation claimants. In addition, the bill would set patient-to-provider ratios and require MPNs to be recertified every three years. ACIC opposes the bill.

SB 597 (Torlakson) Good Driver Discounts: Drunk Drivers. SB 597 would extend the period of time for considering drunk driving convictions from seven to 10 years. ACIC supports the bill.