Bill Text: CA AB2885 | 2015-2016 | Regular Session | Introduced
Bill Title: Insurance: low-cost automobile insurance program.
Spectrum: Moderate Partisan Bill (Democrat 8-1)
Status: (Engrossed - Dead) 2016-11-30 - Died on Senate inactive file. [AB2885 Detail]
Download: California-2015-AB2885-Introduced.html
BILL NUMBER: AB 2885 INTRODUCED
BILL TEXT
INTRODUCED BY Committee on Insurance (Assembly Members Daly
(Chair), Bigelow, Calderon, Cooley, Dababneh, Frazier, Gatto,
Gonzalez, and Rodriguez)
FEBRUARY 25, 2016
An act to amend Section 11629.77 of, to repeal Section 11629.83
of, and to repeal and add Section 11629.79 of, the Insurance Code,
relating to insurance.
LEGISLATIVE COUNSEL'S DIGEST
AB 2885, as introduced, Committee on Insurance. Insurance:
low-cost automobile insurance program.
Existing law establishes within the California Automobile Assigned
Risk Plan (CAARP) a low-cost automobile insurance program for all
counties in California, until January 1, 2020, in order to provide a
means for eligible consumers to buy automobile insurance, as
specified. The parameters of the program, include, but are not
limited to, a surcharge for specified high-risk drivers, eligibility,
sales commissions rates, cancellation restrictions, and reporting
requirements. Existing law also requires the CAARP Advisory Committee
to submit reports to the Insurance Commissioner on specified
proposals, including, among others, allowing a consumer to reinstate,
in lieu of canceling, all policies that have been canceled for
nonpayment of premium and allowing program access to applicants who
are 16 to 18 years of age, economically independent, and who meet
other eligibility guidelines. Existing law requires these reports to
be submitted by January 1, 2016, or July 1, 2016, as specified.
This bill would delete the reporting requirements described above
as of January 1, 2017, and would also delete other obsolete
provisions.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 11629.77 of the Insurance Code is amended to
read:
11629.77. (a) A low-cost automobile insurance policy issued
pursuant to the program shall be canceled only for the following
reasons:
(1) Nonpayment of premium.
(2) Fraud or material misrepresentation affecting the policy or
the insured.
(3) The purchase of additional automobile liability insurance
coverage in violation of subdivision (a) of Section 11629.78.
(4) The purchase or maintenance of automobile liability insurance
coverage other than a low-cost policy for any additional vehicles in
the insured's household, in violation of subdivision (b) of Section
11629.78.
(b) A policy shall be nonrenewed only for the following reasons:
(1) A substantial increase in the hazard insured against.
(2) The insured no longer meets the applicable eligibility
requirements. In this regard, the eligibility of an insured shall be
recertified by the California Automobile Assigned Risk Plan after the
first year of eligibility, and annually thereafter by the insurer
that issued the policy.
(c) By January 1, 2016, the CAARP Advisory Committee shall report
to the commissioner on a proposal, subject to approval by the
commissioner, to allow a consumer to reinstate, in lieu of canceling,
all policies that have been canceled for nonpayment of premium, and
on a proposal, subject to approval by the commissioner, to allow
consumers to make installment payments by debit card or credit card.
The CAARP Advisory Committee shall also report, by July 1, 2016, on a
proposal, subject to approval by the commissioner, to allow access
to the program for applicants 16 to 18 years of age who are
economically independent and meet other eligibility guidelines, and
also for families who have an adult driver covered under the program
and a driver 16 to 18 years of age in the household.
SEC. 2. Section 11629.79 of the Insurance Code is repealed.
11629.79. (a) The program for the County of Los Angeles and the
City and County of San Francisco is authorized to commence operations
on January 1, 2000, but shall be fully operational no later than
July 1, 2000.
(b) To this end, the commissioner, in consultation with the
California Automobile Assigned Risk Plan, shall adopt regulations to
implement the provisions of this article within 60 days of its
effective date.
(c) The program for the Counties of Alameda, Fresno, Orange,
Riverside, San Bernardino, and San Diego shall commence operations on
April 1, 2006, and shall be made operational in all other counties
of California according to the discretion of the commissioner. The
commissioner, in consultation with the California Automobile Assigned
Risk Plan, shall adopt regulations to implement the expansion of the
program to these counties.
SEC. 3. Section 11629.79 is added to the Insurance Code, to read:
11629.79. The low-cost automobile insurance program shall be made
operational in all counties according to the discretion of the
commissioner. The commissioner, in consultation with the California
Automobile Assigned Risk Plan, shall adopt regulations to implement
the program.
SEC. 4. Section 11629.83 of the Insurance Code is repealed.
11629.83. An action challenging the constitutionality of the
establishment of the pilot program by this article shall be commenced
in a court of competent jurisdiction no later than February 1, 2000.
