citation: INS § 1973

text:
An abandonment can be made only at a time limited by all of the following:

(a) Within a reasonable time after the information of the loss.

(b) After the commencement of the voyage.

(c) Before the insured has information of the completion of the voyage.

article: 5. Loss in Marine Insurance


kind: section

code: INS

citation: INS § 1974

text: Where the information upon which an abandonment has been made proves incorrect, or the subject matter of insurance is so far restored when the abandonment is made that there is in fact no total loss, the abandonment is not effective.

history: (History: Enacted by Stats. 1935, Ch. 145.)

division: 2. CLASSES OF INSURANCE

part: 1. FIRE AND MARINE INSURANCE

chapter: 1. The Marine Contract

article: 5. Loss in Marine Insurance

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 1. The Marine Contract > 5. Loss in Marine Insurance


citation: INS § 1975

text: Abandonment is made by giving oral or written notice thereof to the insurer.

article: 5. Loss in Marine Insurance


citation: INS § 1976

text: A notice of abandonment shall be explicit, and shall specify the particular cause of the abandonment, but need state only enough to show that there is probable cause therefor, and need not be accompanied with proof of interest or of loss.

article: 5. Loss in Marine Insurance


citation: INS § 1977

text: An abandonment can be sustained only upon the cause specified in the notice thereof.

article: 5. Loss in Marine Insurance


citation: INS § 1978

text: An abandonment is equivalent to a transfer to the insurer of the insured’s interest, with all the chances of recovery and indemnity.

article: 5. Loss in Marine Insurance


citation: INS § 1979

text: Whenever a marine insurer pays for a loss as if it were an actual total loss, he is entitled to whatever remains of the subject matter insured, or its proceeds or salvage, to the same extent as in the case of a formal abandonment.

article: 5. Loss in Marine Insurance


citation: INS § 1980

text: Upon an abandonment, acts done subsequent to the loss and in good faith by persons who at the time were the insured’s agents in respect to the subject matter insured, are at the risk of the insurer, and for his benefit.

article: 5. Loss in Marine Insurance


citation: INS § 1981

text: An acceptance of an abandonment is not necessary to the rights of the insured, and is not to be presumed from the mere silence of the insurer at the time of receiving notice of abandonment.

article: 5. Loss in Marine Insurance


citation: INS § 1982

text: The acceptance of an abandonment, whether express or implied, is conclusive upon the parties and admits the loss and the sufficiency of the abandonment.

article: 5. Loss in Marine Insurance


citation: INS § 1983

text: An abandonment once made and accepted is irrevocable, unless the ground upon which it was made proves to be unfounded.

article: 5. Loss in Marine Insurance


citation: INS § 1984

text: On an accepted abandonment of a ship, freightage earned previous to the loss belongs to the insurer of the freightage; but freightage subsequently earned belongs to the insurer of the ship.

article: 5. Loss in Marine Insurance


citation: INS § 1985

text: If an insurer refuses to accept a valid abandonment, he is liable as upon an actual total loss, after deducting from the amount of the loss any proceeds of the insured subject matter which have come to the hands of the insured.

article: 5. Loss in Marine Insurance


citation: INS § 1986

text: If an insured omits to abandon, he may nevertheless recover his actual loss.

article: 5. Loss in Marine Insurance


citation: INS § 1987

text:
(a) A valuation fraudulent in fact entitles a marine insurer to rescind the contract.

(b) When the subject matter has been hypothecated by bottomry or respondentia, before its insurance and without the knowledge of the person actually procuring the insurance, such person may show the real value.

(c) Otherwise a valuation in a policy of marine insurance is conclusive between the parties in the adjustment of either a partial or total loss if the insured has some interest at risk and there is no fraud on his part.

article: 5. Loss in Marine Insurance


citation: INS § 1988

text: In a case of partial loss, a marine insurer is liable only for such proportion of the amount insured by him as the loss bears to the value of the whole interest of the insured in the subject matter.

article: 5. Loss in Marine Insurance


citation: INS § 1989

text: Where profits are separately insured in marine insurance, in case of loss the insured is entitled to recover that proportion of such profits which the value of the subject matter lost bears to the value of the whole.

article: 5. Loss in Marine Insurance


citation: INS § 1990

text: In case of a valued policy of marine insurance on freightage or cargo, if only a part of the subject matter is exposed to risk, the valuation applies only in proportion to such part.

article: 5. Loss in Marine Insurance


citation: INS § 1991

text: When profits are valued and insured by marine insurance, a loss of them is conclusively presumed from a loss of the property out of which they were expected to arise, and the valuation fixes their amount.

article: 5. Loss in Marine Insurance


citation: INS § 1992

text:
In estimating a loss under an open policy of marine insurance, the following rules are to be observed:

(a) The value of a ship is its value at the beginning of the risk, including all articles or charges which add to its permanent value or which are necessary to prepare it for the voyage insured.

(b) The value of cargo is either its actual cost to the insured, when laden on board, or, where that cost can not be ascertained, its market value at the time and place of lading, adding the charges incurred in purchasing and placing it on board, but without reference to:

(1) Any losses incurred in raising money for its purchase.

(2) Any drawback on its exportation.

(3) The fluctuations of the market at the port of destination.

(4) Expenses incurred on the way or on arrival.

(c) The value of freightage is the gross freightage, exclusive of primage, without reference to the cost of earning it.

(d) The cost of insurance is in each case to be added to the value thus estimated.

article: 5. Loss in Marine Insurance


citation: INS § 1993

text:
If cargo insured against partial loss arrives at the port of destination in a damaged condition, the loss of the insured is computed as follows:

(a) Deduct the market price, at port of destination, of the damaged subject matter from its market price there when sound.

(b) Take that proportion of the value which the remainder thus ascertained bears to such market price when sound.

article: 5. Loss in Marine Insurance


citation: INS § 1994

text: A marine insurer is liable for all the expense attendant upon a loss which forces the ship into port to be repaired. Where it is agreed that the insured may labor for the recovery of the property, the insurer is liable for the expense incurred thereby. In either case, the liability for such expense is in addition to the liability for a subsequent total loss.

article: 5. Loss in Marine Insurance


citation: INS § 1995

text: In marine insurance, when an insured is required to make a contribution in respect to the subject matter of insurance toward a general average loss, if the average was called for on a loss by a peril insured against, the insurer is liable for the insured’s loss through the contribution.

article: 5. Loss in Marine Insurance


citation: INS § 1996

text: In marine insurance, where an insured has a demand against others for contribution, he may claim the whole loss from the insurer, subrogating the insurer to the insured’s right to contribution. But no such claim can be made upon the insurer after the separation of the interests liable to contribution, nor after the insured, having the right and opportunity to enforce contribution from others, neglects or waives the exercise of that right.

article: 5. Loss in Marine Insurance


citation: INS § 1997

text: In the case of a partial loss of a ship or its equipments, the old materials are to be applied towards payment for the new. Whether the ship is new or old, a marine insurer is liable for only two-thirds of the remaining cost of the repairs after such deduction, except that anchors and cannon must be paid for in full, and sheathing metal at a depreciation of only two and one-half per cent for each month that it has been fastened to the ship.

article: 5. Loss in Marine Insurance


citation: INS § 2010

text: The provisions of Sections 481, 800, 801, 802, 803, and 804 shall not apply to ocean marine insurance as defined in Section 481.

history: (History: Amended by Stats. 1977, Ch. 404.)

article: 6. Exemptions

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 1. The Marine Contract > 6. Exemptions


citation: INS § 2030

text: An insurer is entitled to rescind a contract of fire insurance upon an alteration in the use or condition of the subject matter insured from that to which it is limited by the policy, when such alteration is made without the consent of the insurer by means within the control of the insured, and increases the risk.

chapter: 2. The Fire Insurance Contract

article: 1. Change of Risk

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 2. The Fire Insurance Contract > 1. Change of Risk


citation: INS § 2031

text: When a contract of fire insurance does not restrict use or condition of insured subject matter, such contract is not affected by an alteration in such use or condition if the alteration does not increase the risk.

article: 1. Change of Risk


citation: INS § 2032

text: After the execution of a contract of fire insurance, an act of the insured does not affect the contract unless the act violates policy provisions, even though such act increases the risk and causes a loss.

article: 1. Change of Risk


citation: INS § 2033

text:
(a) The California Safe Homes grant program is hereby established to be developed and administered by the department for the purpose of achieving the following goals:

(1) Reducing local and statewide wildfire losses.

(2) Improving insurability and resilience of vulnerable communities.

(3) Home hardening of insurable properties to mitigate wildfire risk and enable consumers to get access to insurance premium incentives offered by insurance companies and in alignment with the department’s rules.

(b) (1) The Sustainable Insurance Account is hereby established within the Insurance Fund. Funds in the Sustainable Insurance Account shall be available to the department for the program upon appropriation by the Legislature, upon receipt of federal grants or funds, or upon receipt of other sources of grants or funds.

(2) Special funds in the Sustainable Insurance Account shall not be redistributed. Funds shall be used to support activities necessary to carry out the functions and purposes of the program.

(c) The department may adopt rules and establish eligibility requirements and additional procedures as necessary for the effective administration of the program and in accordance with any conditions associated with grants or funds received by the program. The department may contract with a third party to assist with program administration.

(d) When awarding grant funds under the program, the department shall prioritize the following, in descending order:

(1) The replacement of roofs to align with the standards specified in the department’s Safer from Wildfires regulations (Section 2644.9 of Title 10 of California Code of Regulations).

(2) The creation of a five-foot noncombustible zone around the structure, to align with the standards specified in the department’s Safer from Wildfires regulations (Section 2644.9 of Title 10 of California Code of Regulations).

(3) Projects that improve communitywide mitigation to reduce the risk of losses caused by wildfires, with consideration of all of the following priorities:

(A) Collective actions that mitigate risks before a disaster occurs by addressing risk factors on structures and in the surrounding area that exacerbate insurable wildfire losses.

(B) Alignment with existing risk mitigations identified in Section 2644.4.5 or 2644.9 of Title 10 of California Code of Regulations.

(C) Anticipated benefit to insurance policyholders.

(e) Eligible program applicants shall be qualifying individuals and qualifying cities, counties, and special districts, as follows:

(1) For a qualifying individual, grant funds related to incentives specified in paragraphs (1) and (2) of subdivision (d) may be awarded if the following criteria are met:

(A) The property of the applicant is covered by an admitted insurer or the California FAIR Plan Association.

(B) The property of the applicant is in a ZIP Code that overlaps with a high or very high fire hazard severity zone, as shown on current maps published by the Department of Forestry and Fire Protection.

(C) The income of the applicant is no higher than the low-income limit for the county in which they reside, as designated by the Department of Housing and Community Development.

(2) For a qualifying city, county, or special district, the applicant shall demonstrate the alignment of the use of grant funds to enhance and expand the priorities stated in subdivision (d) and the criteria for tracking performance.

(f) The department shall collect information to account for the performance of the program over time, including both of the following:

(1) The department shall require that grantees provide subsequent information on the use of grant funds, including receipt for contractor services, if appropriate, written attestation of work done by the recipient, and documentation that demonstrates if the grantee qualified for wildfire incentives from their insurance company after the grant funds were used to reduce wildfire risk of loss to the home.

(2) Regional information on the geographic distribution of grant funding.

(g) The California FAIR Plan Association shall submit an annual report to the department stating the number of policyholders that have qualified for each of the wildfire mitigation rating factors specified in the department’s Safer from Wildfires regulations (Section 2644.9 of Title 10 of California Code of Regulations).

(h) On or before January 1, 2027, and every two years thereafter, the department shall publish a performance report using aggregate information collected from grantees and metrics for the beneficial impacts of the grants awarded, including an accounting of the funding for each of the mitigation actions, geographic distributions, and present recommendations on how to improve the implementation of the program. The report shall be posted on the department’s internet website and submitted to the Legislature pursuant to Section 9795 of the Government Code.

history: (History: Added by Stats. 2025, Ch. 536, Sec. 2. (AB 888) Effective January 1, 2026.)

article: 1. Change of Risk


citation: INS § 2050

text: The effect of a valuation in a fire policy is the same as in a marine policy.

article: 2. Measure of Indemnity

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 2. The Fire Insurance Contract > 2. Measure of Indemnity


citation: INS § 2051

text:
(a) Under an open policy, the measure of indemnity in fire insurance is the expense to the insured of replacing the thing lost or injured in its condition at the time of the injury, the expense being computed as of the time of the commencement of the fire.

(b) Under an open policy that requires payment of actual cash value, the measure of the actual cash value recovery, in whole or partial settlement of the claim, for either a total or partial loss to the structure or its contents, shall be the amount it would cost the insured to repair, rebuild, or replace the thing lost or injured less a fair and reasonable deduction for physical depreciation based upon its condition at the time of the injury or the policy limit, whichever is less. A deduction for physical depreciation shall apply only to components of a structure that are normally subject to repair and replacement during the useful life of that structure.

history: (History: Amended by Stats. 2019, Ch. 59, Sec. 1. (AB 188) Effective January 1, 2020.)

article: 2. Measure of Indemnity


text:
(a) (1) Under an open policy that requires payment of the replacement cost for a loss, the measure of indemnity is the amount that it would cost the insured to repair, rebuild, or replace the thing lost or injured, without a deduction for physical depreciation, or the policy limit, whichever is less.

(2) If the policy requires the insured to repair, rebuild, or replace the damaged property in order to collect the full replacement cost, the insurer shall pay the actual cash value of the damaged property, as defined in Section 2051, until the damaged property is repaired, rebuilt, or replaced. Once the property is repaired, rebuilt, or replaced, the insurer shall pay the difference between the actual cash value payment made and the full replacement cost reasonably paid to replace the damaged property, up to the limits stated in the policy.

(b) (1) (A) A time limit of less than 12 months from the date that the first payment toward the actual cash value is made shall not be placed upon an insured in order to collect the full replacement cost of the loss, subject to the policy limit.

(B) In the event of a loss relating to a “state of emergency,” as defined in Section 8558 of the Government Code, a time limit of less than 36 months from the date that the first payment toward the actual cash value is made shall not be placed upon the insured in order to collect the full replacement cost of the loss, subject to the policy limit.

(C) This section does not prohibit an insurer from allowing the insured additional time to collect the full replacement cost.

(2) An insurer shall provide to a policyholder one or more additional extensions of six months for good cause pursuant to subparagraph (A) or (B) of paragraph (1) if the insured, acting in good faith and with reasonable diligence, encounters a delay or delays in approval for, or reconstruction of, the home or residence that are beyond the control of the insured. Circumstances beyond the control of the insured include, but are not limited to, unavoidable construction permit delays, the lack of necessary construction materials, or the unavailability of contractors to perform the necessary work.

(3) (A) In the event of a loss relating to a state of emergency, as defined in Section 8558 of the Government Code, an insurer shall not require the insured to provide proof of loss less than 100 days after the loss.

(B) The insurer shall provide to the insured one or more additional extensions of three months for submission of proof of loss for good cause if the insured, acting in good faith and with reasonable diligence, encounters a delay in providing proof of loss that is beyond the control of the insured. Circumstances beyond the control of the insured may include, but are not limited to, any of the following, where applicable to the specific claim:

(i) Delays by the insurer in acknowledging the claim or providing the claimant necessary forms, instructions, and reasonable assistance, including, but not limited to, specifying the information the claimant must provide for proof of loss.

(ii) For personal property coverage, the fact that a personal property inventory is premature if the primary structure has not yet commenced construction.

(iii) The unavailability of contractors to either perform the necessary work or create an estimate to rebuild, repair, or replace.

(iv) The disability, injury, or incapacity of the insured.

(v) The inability of the insured to access the insured property as a result of governmental action or because the insured property is located in an area that is exposed to hazardous materials posing a health risk.

(c) (1) In the event of a total loss of the insured structure, a policy issued or delivered in this state shall not contain a provision that limits or denies, on the basis that the insured has decided to rebuild at a new location or to purchase an already built home at a new location, payment of the building code upgrade cost or the replacement cost, including any extended replacement cost coverage, to the extent those costs are otherwise covered by the terms of the policy or any policy endorsement. However, the measure of indemnity shall not exceed the replacement cost, including the building code upgrade cost and any extended replacement cost coverage, if applicable, to repair, rebuild, or replace the insured structure at its original location.

(2) Notwithstanding any other law, for a residential property insurance policy, the measure of damages available to a policyholder to use to rebuild or replace the insured home at another location shall be the amount that would have been recoverable had the insured dwelling been rebuilt at its original location, and a deduction for the value of land at the new location shall not be permitted from that measure of damages. However, the measure of indemnity shall not exceed the cost, including the building code upgrade cost and any extended replacement cost coverage, if applicable, to rebuild the insured structure at its original location.

(d) This section does not prohibit an insurer from restricting payment in cases of suspected fraud.

(e) On and after July 1, 2026, all policy forms issued or renewed by an insurer shall comply with this section in its entirety, including the changes made to this section by the act that added this paragraph.

history: (History: Amended by Stats. 2025, Ch. 542, Sec. 2. (SB 495) Effective January 1, 2026.)

article: 2. Measure of Indemnity


citation: INS § 2052

text: Whenever the insured desires to have a valuation named in his policy insuring any building or structure against fire, he may require such building or structure to be examined by the insurer and the value of the insured’s interest therein shall be fixed at that time by the parties. The cost of the examination shall be paid by the insured.

article: 2. Measure of Indemnity


citation: INS § 2053

text: A clause shall be inserted in such a valued policy, stating substantially that the value of the insured’s interest in the insured building or structure has been thus fixed.

article: 2. Measure of Indemnity


citation: INS § 2054

text:
In the absence of any change increasing the risk without the consent of the insurer or of fraud on the part of the insured, and except as provided in Sections 2056 and 2058, the insurer under such a valued policy shall pay losses as follows:

(a) In case of a total loss, the whole amount insured upon the insured’s interest in such building or structure, as stated in the policy and upon which the insurers have received a premium.

(b) In case of a partial loss the full amount of the partial loss.

(c) In case there are two or more policies covering the insured’s interest, each policy shall contribute pro rata to the payment of such whole or partial loss.

history: (History: Amended by Stats. 1991, Ch. 602, Sec. 5.)

article: 2. Measure of Indemnity


citation: INS § 2055

text: Except as provided by section 2056, the insurer shall not be required to pay more than the amount stated in such a valued policy.

article: 2. Measure of Indemnity


citation: INS § 2056

text: Stipulations in a valued policy concerning the repairing, rebuilding or replacing of buildings or structures wholly or partially damaged or destroyed shall prevail over the provisions of sections 2054 and 2055.

article: 2. Measure of Indemnity


citation: INS § 2057

text:
Under a contract of fire insurance, payment to the insured shall be made within 30 days after the amount of the loss and the liability of the company have been agreed upon or settled by the insured and the company in writing.

If the company fails to pay within the 30 days, the payment shall bear interest, beginning the 31st day, at the prevailing legal rate. The company also shall be liable for all costs of collection, including reasonable attorneys’ fees, if legal action is necessary to obtain payment after the company has willfully failed to pay within the 30 days.

history: (History: Added by Stats. 1979, Ch. 1165.)

article: 2. Measure of Indemnity


citation: INS § 2058

text:
Notwithstanding any other provision of law, if a loss arising out of fire is rebuilt or replaced, an insured covered by a valued policy shall receive full payment for the loss up to the face amount of the policy. If the loss is not rebuilt or replaced, an insured covered by a valued policy shall receive either the replacement value of the loss or the face amount of the policy, whichever is less. As used in this section, “valued policy” has the meaning set forth in Section 412.

This section applies only to valued policies issued or renewed on and after July 1, 1992.

history: (History: Added by Stats. 1991, Ch. 602, Sec. 6.)

article: 2. Measure of Indemnity


citation: INS § 2060

text:
(a) In the event of a loss under a homeowners’ insurance policy for which the insured has made a claim for additional living expenses, the insurer shall provide the insured with a list of items that the insurer believes may be covered under the policy as additional living expenses. The list may include a statement that the list is not intended to include all items covered under the policy, but only those that are commonly claimed, if this is the case. If the department develops a list for use by insurers, the insurer may use that list.

(b) (1) In the event of a covered loss relating to a state of emergency, as defined in Section 8558 of the Government Code, coverage for additional living expenses shall be for a period of no less than 24 months from the inception of the loss, but shall be subject to other policy provisions. An insurer shall grant an extension of up to 12 additional months, for a total of 36 months, if an insured acting in good faith and with reasonable diligence encounters a delay or delays in the reconstruction process that are the result of circumstances beyond the control of the insured. Circumstances beyond the control of the insured include, but are not limited to, unavoidable construction permit delays, lack of necessary construction materials, and lack of available contractors to perform the necessary work. Additional extensions of six months shall be provided to policyholders for good cause.

(2) A policy that provides coverage for additional living expenses subject to this subdivision shall not limit the policyholder’s right to recovery if the insured home is rendered uninhabitable by a covered peril. However, an insurer may, in lieu of making living expense payments required by this subdivision, provide a reasonable alternative remedy that addresses the property condition that precludes reasonable habitation of the insured premises. The additional living expense coverage subject to this section does not include a utility public safety power shut off event, which is the deenergization of a portion of the electrical distribution or transmission system to reduce the risk of wildfire ignition.

(c) For a loss that is otherwise not subject to paragraph (1) or (2) of subdivision (b), in the event of a state of emergency, as defined in Section 8558 of the Government Code, that is accompanied by an order of civil authority restricting access to the home, related to a covered peril, additional living expense coverage shall be provided for at least two weeks. Additional extensions of two weeks shall be provided to a policyholder for good cause, but shall be subject to other policy provisions.

(d) The amendments made by the act that added this subdivision shall be operative on July 1, 2021.

history: (History: Amended by Stats. 2020, Ch. 261, Sec. 2. (SB 872) Effective January 1, 2021. Operative July 1, 2021, by its own provisions.)

article: 2. Measure of Indemnity


citation: INS § 2061

text:
(a) In the event of a covered loss relating to a state of emergency, as defined in Section 8558 of the Government Code, the following special provisions shall apply under a residential property insurance policy:

(1) If an insured has made a claim for additional living expenses related to a total loss, an insurer shall, upon request by an insured, render an advance payment of no less than four months of living expenses. Additional payment for additional living expenses shall be payable upon proper proof following the advance period.

(2) If an insured has made a claim for contents related to a total loss of a primary residence, an insurer shall not require that the insured use a company-specific inventory form if the insured can provide an inventory using a form that contains substantially the same information. This subdivision does not limit the authority of an insurer to seek additional reasonable information from an insured upon receipt of an inventory form submitted by an insured.

(3) If an insured has made a claim for contents related to a total loss of a primary residence, an insurer shall accept an inventory that includes groupings of categories of personal property, including clothing, shoes, books, food items, CDs, DVDs, or other categories of items for which it would be impractical to separately list each individual item claimed.

(b) This section applies to a claim that arises on or after January 1, 2021.

history: (History: Added by Stats. 2020, Ch. 261, Sec. 3. (SB 872) Effective January 1, 2021.)

article: 2. Measure of Indemnity


citation: INS § 2062

text: In the event of a state of emergency, as defined in Section 8558 of the Government Code, an insurer shall offer a 60-day grace period for payment of premiums for residential property insurance policies covering a property located within the affected area defined in the state of emergency for a period of 60 days after the emergency. This section does not require any change to insurer billing practices regarding billing, automatic payment, or cancellation for nonpayment if the insurer reinstates, without a lapse in coverage or late fees, any policy subject to this section that was canceled for nonpayment of premiums, if requested by the insured and upon reasonably timely payment of all premiums due.

history: (History: Added by Stats. 2020, Ch. 261, Sec. 4. (SB 872) Effective January 1, 2021.)

article: 2. Measure of Indemnity


citation: INS § 2070

text: All fire policies on subject matter in California shall be on the standard form, and, except as provided by this article shall not contain additions thereto. No part of the standard form shall be omitted therefrom except that any policy providing coverage against the peril of fire only, or in combination with coverage against other perils, need not comply with the provisions of the standard form of fire insurance policy or Section 2080; provided, that coverage with respect to the peril of fire, when viewed in its entirety, is substantially equivalent to or more favorable to the insured than that contained in such standard form fire insurance policy.

history: (History: Amended by Stats. 1982, Ch. 124, Sec. 1.)

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 2. The Fire Insurance Contract > 3. California Standard Form Fire Insurance Policy


text:
(a) Any insurer whose insured has made a claim under his or her residential fire or property insurance policy for loss due, in whole or in part, to corrosive soils shall, at least 30 days before the expiration of the applicable statute of limitation, notify its insured in writing of the statute of limitation applicable to the insured’s claim for damage. Failure of the insurer to provide the written notice shall operate to toll the applicable statute of limitation for a period of 30 days from the date written notice is actually given. The notice shall not be required if the insurer has received notice that the insured is represented by an attorney.

This section applies only to claims presented and not denied prior to January 1, 1989, and to claims presented on or after January 1, 1989.

history: (History: Added by Stats. 1988, Ch. 737, Sec. 1.)

article: 3. California Standard Form Fire Insurance Policy


citation: INS § 2071

text:
(a) The following is adopted as the standard form of fire insurance policy for this state: California Standard Form Fire Insurance Policy No.

[Space for insertion of name of company or companies issuing the policy and other matter permitted to be stated at the head of the policy.]

[Space for listing amounts of insurance, rates and premiums for the basic coverages insured under the standard form of policy and for additional coverages or perils insured under endorsements attached.]

In consideration of the provisions and stipulations herein or added hereto and of ____ dollars premium this company, for the term of ________from the ________ day of _______, 20 _______⎫At 12:01 a.m.,to the __________ day of ________ , 20 ______⎭standard time,at location of property involved, to an amount not exceeding ____ dollars, does insure ________ and legal representatives, to the extent of the actual cash value of the property at the time of loss, but not exceeding the amount which it would cost to repair or replace the property with material of like kind and quality within a reasonable time after the loss, without allowance for any increased cost of repair or reconstruction by reason of any ordinance or law regulating construction or repair, and without compensation for loss resulting from interruption of business or manufacture, nor in any event for more than the interest of the insured, against all LOSS BY FIRE, LIGHTNING AND BY REMOVAL FROM PREMISES ENDANGERED BY THE PERILS INSURED AGAINST IN THIS POLICY, EXCEPT AS HEREINAFTER PROVIDED, to the property described hereinafter while located or contained as described in this policy, or pro rata for five days at each proper place to which any of the property shall necessarily be removed for preservation from the perils insured against in this policy, but not elsewhere.

Assignment of this policy shall not be valid except with the written consent of this company.

This policy is made and accepted subject to the foregoing provisions and stipulations and those hereinafter stated, which are hereby made a part of this policy, together with any other provisions, stipulations and agreements as may be added hereto, as provided in this policy.

IN WITNESS WHEREOF, this company has executed and attested these presents; but this policy shall not be valid unless countersigned by the duly authorized agent of this company atSecretary.President.Countersigned thisday of, 20AgentConcealment, fraud

This entire policy shall be void if, whether before or after a loss, the insured has willfully concealed or misrepresented any material fact or circumstance concerning this insurance or the subject thereof, or the interest of the insured therein, or in case of any fraud or false swearing by the insured relating thereto.

Uninsurable and excepted property

This policy shall not cover accounts, bills, currency, deeds, evidences of debt, money or securities; nor, unless specifically named hereon in writing, bullion or manuscripts.

Perils not included

This company shall not be liable for loss by fire or other perils insured against in this policy caused, directly or indirectly, by: (a) enemy attack by armed forces, including action taken by military, naval or air forces in resisting an actual or an immediately impending enemy attack; (b) invasion; (c) insurrection; (d) rebellion; (e) revolution; (f) civil war; (g) usurped power; (h) order of any civil authority except acts of destruction at the time of and for the purpose of preventing the spread of fire, provided that the fire did not originate from any of the perils excluded by this policy; (i) neglect of the insured to use all reasonable means to save and preserve the property at and after a loss, or when the property is endangered by fire in neighboring premises; (j) nor shall this company be liable for loss by theft.

Other insurance

Other insurance may be prohibited or the amount of insurance may be limited by endorsement attached hereto.

Conditions suspending or restricting insurance

Unless otherwise provided in writing added hereto this company shall not be liable for loss occurring (a) while the hazard is increased by any means within the control or knowledge of the insured; or (b) while a described building, whether intended for occupancy by owner or tenant, is vacant or unoccupied beyond a period of 60 consecutive days; or (c) as a result of explosion or riot, unless fire ensues, and in that event for loss by fire only.

Other perils or subjects

Any other peril to be insured against or subject of insurance to be covered in this policy shall be by endorsement in writing hereon or added hereto.

Added provisions

The extent of the application of insurance under this policy and of the contribution to be made by this company in case of loss, and any other provision or agreement not inconsistent with the provisions of this policy, may be provided for in writing added hereto, but no provision may be waived except such as by the terms of this policy or by statute is subject to change.

Waiver provisions

No permission affecting this insurance shall exist, or waiver of any provision be valid, unless granted herein or expressed in writing added hereto. No provision, stipulation or forfeiture shall be held to be waived by any requirement or proceeding on the part of this company relating to appraisal or to any examination provided for herein.

Cancellation of policy

This policy shall be canceled at any time at the request of the insured, in which case this company shall, upon demand and surrender of this policy, refund the excess of paid premium above the customary short rates for the expired time. This policy may be canceled at any time by this company by giving to the insured a 20 days’ written notice of cancellation with or without tender of the excess of paid premium above the pro rata premium for the expired time, which excess, if not tendered, shall be refunded on demand. Notice of cancellation shall state that said excess premium (if not tendered) will be refunded on demand. If the reason for cancellation is nonpayment of premium, this policy may be canceled by this company by giving to the insured a 10 days’ written notice of cancellation.

Mortgagee interests and obligations

If loss hereunder is made payable, in whole or in part, to a designated mortgagee not named herein as the insured, the interest in this policy may be canceled by giving to the mortgagee a 10 days’ written notice of cancellation.

If the insured fails to render proof of loss the mortgagee, upon notice, shall render proof of loss in the form herein specified within 60 days thereafter and shall be subject to the provisions hereof relating to appraisal and time of payment and of bringing suit. If this company shall claim that no liability existed as to the mortgagor or owner, it shall, to the extent of payment of loss to the mortgagee, be subrogated to all the mortgagee’s rights of recovery, but without impairing mortgagee’s right to sue; or it may pay off the mortgage debt and require an assignment thereof and of the mortgage. Other provisions relating to the interests and obligations of the mortgagee may be added hereto by agreement in writing.

Pro rata liability

This company shall not be liable for a greater proportion of any loss than the amount hereby insured shall bear to the whole insurance covering the property against the peril involved, whether collectible or not.

Requirements in case loss occurs

The insured shall give written notice to this company of any loss without unnecessary delay, protect the property from further damage, forthwith separate the damaged and undamaged personal property, put it in the best possible order, furnish a complete inventory of the destroyed, damaged and undamaged property, showing in detail quantities, costs, actual cash value and amount of loss claimed; and within 60 days after the loss, unless the time is extended in writing by this company, the insured shall render to this company a proof of loss, signed and sworn to by the insured, stating the knowledge and belief of the insured as to the following: the time and origin of the loss, the interest of the insured and of all others in the property, the actual cash value of each item thereof and the amount of loss thereto, all encumbrances thereon, all other contracts of insurance, whether valid or not, covering any of said property, any changes in the title, use, occupation, location, possession or exposures of said property since the issuing of this policy, by whom and for what purpose any building herein described and the several parts thereof were occupied at the time of loss and whether or not it then stood on leased ground, and shall furnish a copy of all the descriptions and schedules in all policies and, if required and obtainable, verified plans and specifications of any building, fixtures or machinery destroyed or damaged.

The insured, as often as may be reasonably required and subject to the provisions of Section 2071.1, shall exhibit to any person designated by this company all that remains of any property herein described, and submit to examinations under oath by any person named by this company, and subscribe the same; and, as often as may be reasonably required, shall produce for examinations all books of account, bills, invoices, and other vouchers, or certified copies thereof if the originals be lost, at any reasonable time and place as may be designated by this company or its representative, and shall permit extracts and copies thereof to be made. The insurer shall inform the insured that tax returns are privileged against disclosure under applicable law but may be necessary to process or determine the claim.

The insurer shall notify every claimant that they may obtain, upon request, copies of claim-related documents. For purposes of this section, “claim-related documents” means all documents that relate to the evaluation of damages, including, but not limited to, repair and replacement estimates and bids, appraisals, scopes of loss, drawings, plans, reports, third-party findings on the amount of loss, covered damages, and cost of repairs, and all other valuation, measurement, and loss adjustment calculations of the amount of loss, covered damage, and cost of repairs. However, attorney work product and attorney-client privileged documents, and documents that indicate fraud by the insured or that contain medically privileged information, are excluded from the documents an insurer is required to provide pursuant to this section to a claimant. Within 15 calendar days after receiving a request from an insured for claim-related documents, the insurer shall provide the insured with copies of all claim-related documents, except those excluded by this section. Nothing in this section shall be construed to affect existing litigation discovery rights.

After a covered loss, the insurer shall provide, free of charge, a complete, current copy of this policy within 30 calendar days of receipt of a request from the insured. The time period for providing this policy may be extended by the Insurance Commissioner.

An insured who does not experience a covered loss shall, upon request, be entitled to one free copy of this policy annually. The policy provided to the insured shall include, where applicable, the policy declarations page.

Appraisal

In case the insured and this company shall fail to agree as to the actual cash value or the amount of loss, then, on the written request of either, each shall select a competent and disinterested appraiser and notify the other of the appraiser selected within 20 days of the request. Where the request is accepted, the appraisers shall first select a competent and disinterested umpire; and failing for 15 days to agree upon the umpire, then, on request of the insured or this company, the umpire shall be selected by a judge of a court of record in the state in which the property covered is located. Appraisal proceedings are informal unless the insured and this company mutually agree otherwise. For purposes of this section, “informal” means that no formal discovery shall be conducted, including depositions, interrogatories, requests for admission, or other forms of formal civil discovery, no formal rules of evidence shall be applied, and no court reporter shall be used for the proceedings. The appraisers shall then appraise the loss, stating separately actual cash value and loss to each item; and, failing to agree, shall submit their differences, only, to the umpire. An award in writing, so itemized, of any two when filed with this company shall determine the amount of actual cash value and loss. Each appraiser shall be paid by the party selecting him or her and the expenses of appraisal and umpire shall be paid by the parties equally. In the event of a government-declared disaster, as defined in the Government Code, appraisal may be requested by either the insured or this company but shall not be compelled.

Adjusters

If, within a six-month period, the company assigns a third or subsequent adjuster to be primarily responsible for a claim, the insurer, in a timely manner, shall provide the insured with a written status report. For purposes of this section, a written status report shall include a summary of any decisions or actions that are substantially related to the disposition of a claim, including, but not limited to, the amount of losses to structures or contents, the retention or consultation of design or construction professionals, the amount of coverage for losses to structures or contents and all items of dispute.

Company’s options

It shall be optional with this company to take all, or any part, of the property at the agreed or appraised value, and also to repair, rebuild or replace the property destroyed or damaged with other of like kind and quality within a reasonable time, on giving notice of its intention so to do within 30 days after the receipt of the proof of loss herein required.

Abandonment

There can be no abandonment to this company of any property.

When loss payable

The amount of loss for which this company may be liable shall be payable 60 days after proof of loss, as herein provided, is received by this company and ascertainment of the loss is made either by agreement between the insured and this company expressed in writing or by the filing with this company of an award as herein provided.

Suit

No suit or action on this policy for the recovery of any claim shall be sustainable in any court of law or equity unless all the requirements of this policy shall have been complied with, and unless commenced within 12 months next after inception of the loss. If the loss is related to a state of emergency, as defined in subdivision (b) of Section 8558 of the Government Code, the time limit to bring suit is extended to 24 months after inception of the loss.

Subrogation

This company may require from the insured an assignment of all right of recovery against any party for loss to the extent that payment therefor is made by this company. (b) Any amendments to this section by the enactment of Senate Bill 658 of the 2001–02 Regular Session shall govern a policy utilizing the form provided in subdivision (a) when that policy is originated or renewed on or after January 1, 2002.

(c) The amendments to this section made by the act adding this subdivision shall govern a policy utilizing the form provided in subdivision (a) when that policy is originated or renewed on or after January 1, 2004.

(d) (1) The amendments to this section made by the act adding this subdivision govern a policy originated or renewed on or after the effective date of this act.

(2) Notwithstanding paragraph (1), an insurer shall incorporate the revisions to the standard form of fire insurance policy made by the act adding this subdivision on or before July 1, 2019.

history: (History: Amended by Stats. 2018, Ch. 639, Sec. 1. (AB 2594) Effective September 21, 2018.)


text:
(a) This section applies to an examination of an insured under oath pursuant to Section 2071 labeled “Requirements in case loss occurs” and other relevant provisions of that section, and to any policy that insures property and contains a provision for examining an insured under oath, when the policy is originated or renewed on and after January 1, 2002.

The following are among the rights of each insured who is requested to submit to an examination under oath:

(1) An insurer that determines that it will conduct an examination under oath of an insured shall notify the insured of that determination and shall include a copy of this section in the notification.

(2) An insurer may conduct an examination under oath only to obtain information that is relevant and reasonably necessary to process or investigate the claim.

(3) An examination under oath may only be conducted upon reasonable notice, at a reasonably convenient place and for a reasonable length of time.

(4) The insured may be represented by counsel and may record the examination proceedings in their entirety.

(5) The insurer shall notify the insured that, upon request and free of charge, it will provide the insured with a copy of the transcript of the proceedings and an audio or video recording of the proceedings, if one exists. Where an insured requests a copy of the transcript, the recording, or both, of the examination under oath, the insurer shall provide it within 10 business days of receipt by the insurer or its counsel of the transcript, the recording, or both. An insured may make sworn corrections to the transcript so it accurately reflects the testimony under oath.

(6) In an examination under oath, an insured may assert any objection that can be made in a deposition under state or federal law. However, if as a result of asserting an objection, an insured fails to provide an answer to a material question, and that failure prevents the insurer from being able to determine the extent of loss and validity of the claim, the rights of the insured under the contract may be affected.

(7) An insured who submits a fraudulent claim may be subject to all criminal and civil penalties applicable under law.

(b) The department shall conduct a study quantifying the number of examinations under oath performed by carriers regulated by the department and the number of contacts made by consumers regarding alleged concerns with the utilization of the examination under oath process for the resolution of pending claims. The department shall report both the number of examinations under oath performed by each carrier and the number of justified and unjustified claims alleged by insureds as defined in this code. To the best extent practicable, the department shall also determine if any of these complaints also resulted in suspected fraudulent claims with the department’s fraud division.

(c) The department shall also survey licensed carriers as to the number of suspected fraudulent claims under residential property insurance policies that are submitted to the department’s fraud division as required by law, and that resulted, or eventually resulted, in the utilization of the examination under oath process. Policies of residential property insurance shall be as defined in Section 10087.

(d) The department shall submit the findings of this report to the chairpersons of the Assembly and Senate Committees on Insurance no later than March 1, 2003.

history: (History: Amended by Stats. 2009, Ch. 88, Sec. 70. (AB 176) Effective January 1, 2010.)


citation: INS § 2072

text: The policy is not required to be used for reinsurance between insurers.

history: (History: Repealed and added by Stats. 1949, Ch. 556.)


citation: INS § 2073

text: The policy shall be plainly printed. The type shall not be smaller than eight-point and in a style not less legible than Century and subheads shall be in type larger than eight-point and in a style not less legible than Century. The lines of the policy following the countersignature clause shall be numbered consecutively.

history: (History: Amended by Stats. 1953, Ch. 182.)


citation: INS § 2074

text:
Either the blanks in the standard form or those in an endorsement attached thereto shall be appropriately filled. The first page of the policy or an endorsement attached thereto may be arranged to show in schedule form the amounts of insurance, rates and premiums for the basic coverages insured under the standard form of policy and additional coverages or perils insured under endorsements attached, and such other data as may be conveniently included for duplication on daily reports for office records.

If such a schedule clearly shows the amount at risk, the rate, and the premium in respect of fire insurance, the words, “the above specified” may be inserted in the blanks preceding the word “dollars” in the two places in which “dollars” appears in that portion of the standard form which precedes the countersignature clause, or in identical blanks in an endorsement attached to the standard form and containing the paragraph in the standard form in which the blanks appear.

history: (History: Amended by Stats. 1949, Ch. 556.)


text: In lieu of showing the term of coverage in the form set forth in Section 2071, the standard form policy may show the term in any form which clearly states the period during which the insurance is to continue. The period shall begin and end on specified dates at 12:01 a.m. standard time, at the location of the property involved. An example of a permissible method of showing the term is: “______ for the term ofAt 12:01 a.m.from(Standard Time) toAt 12:01 a.m.(Standard Time)at location of property involved, ______”

history: (History: Amended by Stats. 1971, Ch. 1564.)


text:
In lieu of showing the attestation clause and official signatures in the form as set forth in Section 2071, the standard form policy may show, immediately following the policy provisions, the following:

“In witness whereof, this company has executed and attested these presents; but this policy shall not be valid unless countersigned by the duly authorized agent of this company at the agency hereinbefore mentioned.SecretaryPresident”

history: (History: Added by Stats. 1953, Ch. 182.)


text:
Notwithstanding the provisions of Section 2071 granting the right to both insured and insurer to cancel a policy of insurance, or the provisions of any policy conforming to that section, the right of the insurer, but not that of the insured, to so cancel shall be subject to modification by written general order or orders of the commissioner, if: (1) the property insured is in the State of California; (2) the insurance policy contains any “basic property insurance” as that term is defined in Chapter 9 (commencing with Section 10090) of Part 1, Division 2 of this code; and (3) the property insured is, on the date of the order or orders of the commissioner, within any geographic area to which any “Fair Plan” approved by the commissioner pursuant to that chapter is applicable.

The commissioner’s order or orders may deny to insurers the right to cancel those policies on less than 60 days’ notice, or on a lesser number of days of notice that the commissioner may designate, except that the number of days of notice may not be less than 20. The commissioner’s order or orders shall apply uniformly to all insurers having those policies outstanding in all or any designated portions of such a geographic area.

This section, and any order of the commissioner, shall not be effective as to any policy unless the property insured therein is then within a geographic area to which a “Fair Plan” is applicable.

The orders of the commissioner may contain generally applicable exceptions of certain types of properties, certain types of policies, policies solicited in a particular manner, or policies obtained upon particular representations of the insured. The orders shall except policies upon which premiums or premium installments have not been paid in accordance with the agreement of the insured, whether payable directly to the insurer or its agent, or indirectly under any premium finance plan or plans for the extension of credit.

No order shall be adopted by the commissioner pursuant to this section unless he or she has determined that the order is reasonably necessary to carry out the provisions of a “Fair Plan”.

history: (History: Amended by Stats. 2003, Ch. 148, Sec. 3. Effective January 1, 2004.)


text:
Notwithstanding any of the other provisions of Sections 2071 and 6010, those paragraphs in Sections 2071 and 6010 captioned “Cancellation of policy” may, in any policy subject to Chapter 11 (commencing with Section 675) of Part 1 of Division 1, have that paragraph in the text of the policy stricken or changed by endorsement and the following paragraph substituted therefor:

“This policy shall be canceled at any time at the request of the insured, in which case this company shall, upon demand and surrender of the policy, refund the excess of paid premiums above the customary short rate for the expired time. This policy may be canceled by this company by written notice mailed or delivered to the named insured at the address shown in the policy, with or without tender of the excess of paid premiums above the pro rata premiums for the expired time, stating when, not less than 20 days after that mailing or delivery, cancellation shall be effective. Notice of cancellation shall state that the excess premiums, if not tendered, will be refunded on demand, and contain those matters that are required to comply with Chapter 11 (commencing with Section 675) of Part 1 of Division 1.”

history: (History: Amended by Stats. 2003, Ch. 148, Sec. 4. Effective January 1, 2004.)


text: During such time as countersignatures are not required by law, the provisions of Section 2071 requiring policies to make provision for countersignatures shall not be in effect and an insurer may omit such provisions from its policies.

history: (History: Added by Stats. 1969, Ch. 506.)


citation: INS § 2075

text: By special agreement indorsed on the policy or added thereto, the provisions regarding appraisement or apportionment of loss may be waived and the valuations of all or any of the insured subject matter in case of total loss may be agreed upon in advance of loss.

history: (History: Enacted by Stats. 1935, Ch. 145.)


citation: INS § 2076

text: The insurer may add to the standard form any matter relating to its financial condition, directors, officers, shareholders and history, and the address of its home office and principal office in the United States.


citation: INS § 2077

text: The insurer may add to the standard form, in red ink, any provisions required or permitted in its policies by the State or country of its organization, respecting limitation of liability of the insurer, its shareholders or members.


citation: INS § 2078

text: There may be added to the standard form, clauses providing for and defining the rights, duties and obligations of mortgagees, assignees and other parties having or acquiring an interest in, right to, or lien upon the insured subject matter.


citation: INS § 2079

text:
Clauses may be added to the standard form:

(a) Covering subject matter and risks not otherwise covered; provided that clauses covering loss or damage caused by nuclear reaction, nuclear radiation or radioactive contamination, all whether directly or indirectly resulting from an insured peril under the standard policy issued pursuant to Section 2071 may be insured under said policy only by a written endorsement providing such insurance, with such endorsement affixed to said standard policy.

(b) Assuming greater liability than is otherwise imposed on the insurer.

(c) Granting insured permits and privileges not otherwise provided.

(d) Waiving any of the matters which may be waived and which avoid the policy or suspend the insurance.

(e) Waiving any of the requirements imposed on the insured after loss.

(f) As provided in Section 3047.

history: (History: Amended by Stats. 1959, Ch. 1101.)


citation: INS § 2080

text: Except as otherwise provided in this article, clauses imposing specified duties and obligations upon the insured and limiting the liability of the insurer may be attached to the standard form. Such clauses shall be in the rider or riders attached to the standard form of policy and shall be in type as provided in Section 2073.

history: (History: Amended by Stats. 1982, Ch. 124, Sec. 2.)


citation: INS § 2081

text:
Whenever a clause is inserted, or rider attached, affecting the standard form liability of the insurer for loss or damage by fire occasioned either directly or indirectly by hurricane, volcanic action or other disturbance of nature, the clause or rider shall be printed in red ink in type larger than small pica and at the head of the policy there shall be printed in red ink and in large boldfaced type the words, “This policy contains limitations of liability not permitted in the California standard form.”

Nothing in this section exempts an insurer from, or permits an insurer to limit, its liability or obligation under a fire insurance policy to cover the losses from a fire that is caused by, or follows, an earthquake.

history: (History: Amended by Stats. 1991, Ch. 665, Sec. 1. Effective October 9, 1991.)


citation: INS § 2082

text: Any insurers, other than corporations, issuing policies on subject matter in California, shall use the standard form, changing only such words as refer to the corporation or company, to officers or agents of the corporation or company, or to its organization. Such other insurers may substitute, in place of the words having peculiar reference to corporations, appropriate words having similar reference to themselves.


text: Where an insurer has no president or secretary in the United States, the facsimile signature on the standard form may be that of its principal executive officer or manager residing within the United States.

history: (History: Added by Stats. 1950, 1st Ex. Sess., Ch. 5.)


citation: INS § 2083

text: It is a misdemeanor for any insurer or any agent to countersign or issue a fire policy covering in whole or in part property in California and varying from the California standard form of policy otherwise than as provided by this article. Any policy so issued shall, notwithstanding, be binding upon the issuing insurer.


citation: INS § 2084

text:
(a) After a covered loss under a policy covered by Section 2071, an insurer shall provide to the insured, free of charge, a complete copy of the policy that was in effect at the time of the loss within 30 calendar days of receipt of a request from the insured. The time period for providing the policy may be extended by the Insurance Commissioner. The policy provided to the insured shall include, where applicable and without limitation, the full insurance policy, any endorsements to the policy, and the policy declarations page.

(b) An insured under a policy covered by Section 2071 who does not experience a covered loss shall, upon request, be entitled to one free copy of his or her policy annually. The policy provided to the insured shall include, where applicable and without limitation, the full insurance policy, any endorsements to the policy, and the policy declarations page.

(c) (1) An insurer responding to a request made pursuant to subdivision (a) for a covered loss that was the result of a state of emergency, as defined in Section 8558 of the Government Code, may, and an insurer compliant with the electronic transaction requirements of Section 38.6 shall, upon the request of an insured who has not elected to receive electronic documents pursuant to Section 38.6, transmit or provide access to an electronic copy of the entire policy. Section 38.6 shall not apply to transmitting or providing access to a policy pursuant to this paragraph.

(2) A request of an insured pursuant to paragraph (1) does not constitute a request to participate in electronic transactions or communications for any purpose other than receiving the documents described in this section.

history: (History: Amended by Stats. 2018, Ch. 69, Sec. 1. (AB 1799) Effective January 1, 2019.)


citation: INS § 2085

text:
(a) (1) In the case of a declaration of a disaster by the President of the United States or the Governor, if a property owner or owner’s legal representative is unable to identify the insurer of the owner’s property that is located in the declared disaster area, the commissioner shall, at the request of the property owner or owner’s legal representative, electronically provide the property owner’s name, any contact information provided to the commissioner, and property location information to insurers that issue homeowners’ insurance policies subject to Section 2071.

(2) The commissioner or an insurer may conclusively presume that a request submitted pursuant to paragraph (1) is a bona fide request from the property owner or owner’s legal representative. Information transmitted to the commissioner or an insurer pursuant to this section shall, within the meaning of subdivision (b) of Section 1798.24 of the Civil Code, constitute information provided with the voluntary written consent of the person transmitting the information and shall authorize the commissioner or an insurer to provide the information to others in accordance with this section. No reasonable expectation of privacy shall exist for the information provided to the commissioner or an insurer pursuant to this section and no cause of action shall arise nor shall any liability be imposed against the commissioner or an insurer, the commissioner’s or an insurer’s authorized representatives, or any department or insurer employee for statements made or conduct performed in good faith while carrying out the provisions of this section.

(3) Communication between a property owner or owner’s legal representative and the commissioner, and between the commissioner and insurers, shall not constitute the filing of a claim.

(b) An insurer that issues homeowners’ insurance policies subject to Section 2071 shall provide the commissioner with an email address for accepting an electronic transmission from the commissioner pursuant to subdivision (a).

(c) (1) An insurer that issues homeowners’ insurance policies subject to Section 2071 shall respond to the property owner or owner’s legal representative within 90 days after receiving a transmission pursuant to subdivision (a) and shall indicate if the insurer issued a homeowners’ insurance policy on the property located in the disaster area and identified in the commissioner’s communication that was in force at the time that the disaster occurred. An insurer’s response to the property owner or owner’s legal representative pursuant to this paragraph shall not be an acknowledgment of a claim, and shall not constitute an admission of coverage under any policy for any loss.

(2) Notwithstanding paragraph (1), neither the department nor the insurer shall be required to respond to a property owner or the owner’s legal representative if the insurer determines that it did not issue a policy for the property.

(3) A response by an insurer to the property owner or the owner’s legal representative pursuant to paragraph (1) shall be provided free of charge.

history: (History: Added by Stats. 2017, Ch. 361, Sec. 1. (SB 569) Effective January 1, 2018.)


citation: INS § 2095

text:
The Legislature finds and declares all of the following:

(a) More than 2,000,000 California households, or approximately one in four residential structures in California, are located within or near “high” or “very high” fire hazard severity zones. These households are particularly vulnerable to increasingly catastrophic wildfires that pose urgent threats to lives, property, and resources in California.

(b) The state has invested nearly three billion dollars ($3,000,000,000) since the Budget Act of 2019 into programs and projects to improve forest health and resilience, create fuel breaks, harden homes and communities, and build resilient lifeline infrastructure to withstand wildfire disasters when they do occur.

(c) Chapter 391 of the Statutes of 2019, which created the California Wildfire Mitigation Program jointly administered by the Office of Emergency Services and the Department of Forestry and Fire Protection, recognized that “California must develop statewide options to encourage cost-effective structure hardening to create fire-resistant homes, businesses, and public buildings within wildfire hazard areas and with a focus on vulnerable communities.”

(d) State support for home hardening incentive programs is especially critical now. California residents are finding homeowners’ insurance in very high risk fire areas to be increasingly difficult and costly to obtain, if coverage is even available. The Department of Insurance determined that the majority of nonrenewals, refusals to insure, and increased premiums resulted from insurers’ use of wildfire risk models that do not account for wildfire risk reduction or home hardening measures completed by the homeowner or community.

(e) On September 21, 2023, Governor Newsom issued Executive Order No. N-13-23 asking the Insurance Commissioner to take “prompt regulatory action to strengthen and stabilize California’s marketplace for homeowners insurance and commercial property insurance,” including maintaining “the long-term availability of homeowners and commercial property insurance coverage.”

(f) Regular review of and updates to the Department of Insurance’s Safer from Wildfires regulations will advance these goals. The Safer from Wildfires regulations incentivize homeowners to invest in specified wildfire risk reduction and home hardening measures by requiring admitted insurers to reflect and take into account these measures in their ratings plans. The voluntary home hardening measures included in the Safer from Wildfires regulations provide a higher level of fire protection than what is otherwise required by state law and help contain the spread of wildfires, reduce property damage, save lives, and encourage insurance companies to remain committed to the California insurance market.

(g) It is the intent of the Legislature to further incentivize homeowners to invest in demonstrably effective home hardening measures by requiring the Department of Insurance to periodically review its Safer from Wildfires regulations and consider whether or not to amend the regulations to include additional communitywide mitigation programs and building hardening measures, including use of specified noncombustible construction materials that are included by the Office of the State Fire Marshal on the Building Materials Listing. Noncombustible construction materials, as defined by the California Building Standards Code (Title 24 of the California Code of Regulations), provide the highest level of fire safety among materials included on the Building Materials Listing because these materials do not ignite, even when exposed to high temperatures for extended periods of time. Use of noncombustible construction materials is an effective means of reducing fire-related property damage and the contribution of structures to the spread of wildfires.

(h) The Building Materials Listing includes construction materials that have been tested and analyzed by a laboratory accredited by the Office of the State Fire Marshal to confirm the materials meet established performance and reliability features.

history: (History: Added by Stats. 2025, Ch. 472, Sec. 1. (AB 1) Effective January 1, 2026.)

article: 5. Reduced Wildfire Risk

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 2. The Fire Insurance Contract > 5. Reduced Wildfire Risk


citation: INS § 2096

text:
For purposes of this article:

(a) “Building Materials Listing” means the list of construction materials and equipment biennially prepared by the Office of the State Fire Marshal pursuant to Section 13144.1 of the Health and Safety Code as part of the Office of the State Fire Marshal’s Building Materials Listing Program.

(b) “Safer from Wildfires regulations” means the regulations set forth in Section 2644.9 of Title 10 of California Code of Regulations.

article: 5. Reduced Wildfire Risk


citation: INS § 2097

text:
(a) (1) On or before January 1, 2030, and every five years thereafter, the department shall consider whether to update the Safer from Wildfires regulations to include additional building hardening measures for property-level mitigation efforts and communitywide wildfire mitigation programs.

(2) If the department updates the Safer from Wildfires regulations, it shall, as a part of its first consideration, consider whether to update these regulations to include in the regulations the installation of construction materials included by the Office of the State Fire Marshal on the Building Materials Listing or in compliance with the most recent provisions of Chapter 7A of the California Building Standards Code.

(b) As part of its consideration pursuant to subdivision (a), the department shall do both of the following:

(1) Consult with the Office of Emergency Services, the Department of Forestry and Fire Protection, the Public Utilities Commission, and the Office of Planning and Research to identify additional building hardening measures for property-level mitigation efforts and communitywide wildfire mitigation programs to consider.

(2) Consult with relevant stakeholders to consider potential revisions to the Safer from Wildfires regulations.

(3) Develop and implement a process that allows for meaningful public participation that includes, at a minimum, all of the following:

(A) Holding at least one public meeting to allow interested persons to submit suggestions for additional building hardening measures for property-level mitigation efforts and communitywide wildfire mitigation programs for the department to consider.

(B) Making available for public review and comment, including during at least one public meeting, a preliminary list of building hardening measures for property-level mitigation efforts and communitywide wildfire mitigation programs being considered by the department for inclusion in the Safer from Wildfires regulations.

(C) Making available to the public a final list of building hardening measures for property-level mitigation efforts and communitywide wildfire mitigation programs the department proposes to include in the list of building hardening measures identified in the Safer from Wildfires regulations before amending the regulations pursuant to the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).

(c) If the department makes public a final list of building hardening measures for property-level mitigation efforts and communitywide wildfire mitigation programs to be included in the list of building hardening measures identified in the Safer from Wildfires regulations pursuant to subparagraph (C) of paragraph (3) of subdivision (b), the department shall initiate the Administrative Procedure Act rulemaking process to amend the Safer from Wildfires regulations within 30 days of publishing the final list.

article: 5. Reduced Wildfire Risk


citation: INS § 4010

text: A “mutual” insurer is an insurance corporation without capital stock owned by its policyholders collectively, who have the right to vote in the election of its directors.

history: (History: Added by Stats. 1963, Ch. 1772.)

chapter: 4. General Mutual Insurers

article: 1. General Provisions

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 4. General Mutual Insurers > 1. General Provisions


citation: INS § 4011

text: The provisions of Section 36 shall apply to domestic mutual insurers as well as foreign mutual insurers.

article: 1. General Provisions


citation: INS § 4012

text: Domestic mutual insurers, incorporating or qualifying to transact any or all of the classes of insurance designated in Sections 100 through 123 and 700. 01, shall be subject to all provisions of this code applicable to other incorporated insurers, except where otherwise provided. Domestic mutual insurers shall not be required to have or issue capital stock or shares nor shall they be required to distribute an annual report to a member other than at the time of the initial policy issuance or once each year on renewal. The provisions of Section 1140 shall apply to such an insurer except that the provisions of the Corporation Law referring to shareholders or members shall be applied as though such provisions referred to the policyholders or members of a mutual.

history: (History: Amended by Stats. 1983, Ch. 392, Sec. 1.)

article: 1. General Provisions


citation: INS § 4013

text:
(a) Each policyholder of a domestic mutual insurer, other than the holder of a reinsurance contract, is a member of the insurer during the policy period, as defined in the policy or the declarations page of the policy, with all rights and obligations of that membership, and the policy shall so specify.

(b) A “tail” or extended reporting policy or endorsement permitting claims to be reported after the expiration or termination of the policy period shall not extend the policy period of a “claims made” policy and all rights and obligations of membership shall cease upon the expiration or termination of the policy period. If an insurer has allowed or does allow, by contract, conduct, or otherwise, the holder of a “tail” or extended reporting policy or endorsement to have privileges, in whole or in part, identical, or similar to some or all of the rights of membership, the holder is nevertheless not deemed a member.

(c) Subdivision (b) and the modifications to subdivision (a) made by the act adding this subdivision, are declaratory of existing law and do not affect any existing contract rights.

history: (History: Amended by Stats. 2000, Ch. 255, Sec. 1. Effective January 1, 2001.)

article: 1. General Provisions


citation: INS § 4014

text: Any person, government or governmental agency, state or political subdivision thereof, public or private corporation, board, association, estate, trustee or fiduciary may be a policyholder member of a mutual insurer.

article: 1. General Provisions


citation: INS § 4015

text: With respect to the management, records, and affairs of a domestic mutual insurer qualified to transact any or all of the classes of insurance designated in Section 700.01, and except as otherwise provided in this chapter, a member of such mutual insurer shall have the same character of rights and relationship as a stockholder has toward a domestic stock insurer subject to the provisions of this code.

history: (History: Amended by Stats. 1975, Ch. 824.)

article: 1. General Provisions


citation: INS § 4016

text: Each member of a domestic mutual insurer is entitled to one vote upon each matter coming to a vote at meetings of members.

article: 1. General Provisions


text:
Notice of all meetings of members whether annual or special shall be given in writing to the members entitled to vote by the secretary, or an assistant secretary, or other persons charged with that duty, or if there be no such officer, or in case of his or her neglect or refusal, by any director or member. At the option of the insurer the notice may be imprinted on premium notices or receipts or on both.

A notice may be given by the insurer to any member either personally, or by mail, or other means of written communication, charges prepaid, addressed to the member at his or her address appearing on the books of the insurer, or given by him or her to the insurer for the purpose of notice. If a member gives no address, notice shall be deemed to have been given him or her if sent by mail or other means of written communication addressed to the place where the principal office of the insurer is situated, or if published at least once in a newspaper of general circulation in the county in which the office is located.

Notice of any meeting of members shall be sent to each member entitled thereto not less than seven days before a meeting, unless the bylaws provide otherwise.

Notice of any meeting of members shall specify the place, the day, and the hour of the meeting and the general nature of the business to be transacted.

Notice of an annual meeting to be held at the time and place specified shall be sufficiently given if published at least once in each of four successive weeks in a newspaper of general circulation in the county in which the principal office of the insurer is located, and if so published no other notice of the meeting shall be required.

history: (History: Added by Stats. 1981, Ch. 300, Sec. 1.)

article: 1. General Provisions


text:
(a) The presence in person or by proxy of 5 percent of the members of a domestic mutual insurer entitled to vote at any meeting shall constitute a quorum for the transaction of all business of the insurer, including but not limited to, the amendment of the articles of incorporation or bylaws of the insurer, unless otherwise provided in the articles of incorporation or bylaws of such insurer.

(b) Any required member approval shall be by the affirmative vote of a number of members which, as to a stock corporation, would constitute approval of the shareholders (Section 153 of the Corporations Code) rather than approval of the outstanding shares (Section 152 of the Corporations Code).

history: (History: Amended by Stats. 1983, Ch. 21, Sec. 1. Effective May 5, 1983.)

article: 1. General Provisions


citation: INS § 4017

text:
A member shall have the right to vote in person or by his written proxy filed with the corporate secretary not less than five days prior to the meeting. No such proxy shall be made irrevocable, nor be valid beyond the earliest of the following dates:

(a) The date of expiration set forth in the proxy; or

(b) The date of termination of membership; or

(c) Eleven months from the date of execution of the proxy; or

(d) Such time as may be specified in the bylaws, not to exceed eleven months.

history: (History: Amended by Stats. 1980, Ch. 209, Sec. 4.)

article: 1. General Provisions


citation: INS § 4018

text: No member’s vote upon any proposal to divest the insurer of its business or assets, or the major part thereof, shall be registered or taken except in person or by proxy newly executed and specific as to the matter to be voted upon.

article: 1. General Provisions


citation: INS § 4019

text: This chapter does not apply to a mutual insurer that has converted to a mutual legal reserve insurer pursuant to former Chapter 9 (commencing with Section 10810) of Part 2 of Division 2. Except for Section 4016.2, this chapter does not apply to (a) a mutual insurer that has completed proceedings for voluntary mutualization pursuant to Chapter 13 (commencing with Section 11525) of Part 2 or (b) a stock life insurer that has converted from a mutual life insurer, or a mutual holding company or a stock holding company formed, pursuant to proceedings under Chapter 14 (commencing with Section 11535) of Part 2.

history: (History: Amended by Stats. 1998, Ch. 421, Sec. 3. Effective January 1, 1999.)

article: 1. General Provisions


citation: INS § 4020

text: The affairs of every domestic mutual insurer shall be managed by a board of directors consisting of not less than 5 directors nor more than 15 directors.

article: 2. Directors

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 4. General Mutual Insurers > 2. Directors


citation: INS § 4021

text: Directors shall be elected by the members of a domestic mutual insurer at the annual meeting of members. Directors may be elected for terms of not more than five years each and until their successors are elected and have qualified, and if to be elected for terms of more than one year, the insurer’s bylaws shall provide for a staggered term system under which the terms of a proportionate part of the number of the board of directors shall expire on the date of each annual meeting of members.

article: 2. Directors


citation: INS § 4022

text: A director of a mutual insurer shall be a policyholder thereof.

article: 2. Directors


citation: INS § 4023

text: As to an insurer operating as an authorized insurer only in the State of California, a majority of the members of the insurer’s board of directors shall be citizens of and shall actually reside in this State.

article: 2. Directors


citation: INS § 4030

text: A domestic mutual insurer shall not hereafter make any contract whereby any person is granted or is to enjoy in fact the management of the insurer to the substantial exclusion of its board of directors or to have the controlling or preemptive right to produce substantially all insurance business for the insurer, unless the contract is filed with and approved by the commissioner. That contract shall not be effective unless and until approved by the insurance commissioner. That approval shall be obtained by filing application for approval with the commissioner accompanied by a one-hundred-fifty-dollar ($150) fee. Any disapproval shall be delivered to the insurer in writing, stating the grounds therefor.

history: (History: Amended by Stats. 2017, Ch. 534, Sec. 51. (AB 1699) Effective January 1, 2018.)

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 4. General Mutual Insurers > 3. Management and Exclusive Agency Contracts


citation: INS § 4031

text: Any such contract shall provide that any such manager or producer of its business shall within 90 days after expiration of each calendar year furnish the insurer’s board of directors a written statement of amounts received under or on account of the contract and amounts expended thereunder during such calendar year, including the emoluments received therefrom by the respective directors, officers, and other principal management personnel of the manager or producer, and with such classification of items and further detail as the insurer’s board of directors may reasonably require.

article: 3. Management and Exclusive Agency Contracts


citation: INS § 4032

text:
The commissioner shall disapprove any such contract if he finds that it:

(a) Subjects the insurer to excessive charges; or

(b) Is to extend for an unreasonable length of time; or

(c) Does not contain fair and adequate standards of performance; or

(d) Contains other inequitable provisions or provisions which impair the proper interests of policyholders of the insurer.


citation: INS § 4033

text: The commissioner may, after a hearing held thereon, withdraw his approval of any such contract theretofore approved by him, if he finds that the bases of his original approval no longer exist, or that the contract has, in actual operation, shown itself to be subject to disapproval on any of the grounds referred to in Section 4032 above.


citation: INS § 4034

text: The holder of any such contract described in this Article shall be subject to examination by the commissioner pursuant to Article 4 (beginning with Section 730), Chapter 1, Part 2, Division 1 of this code.


citation: INS § 4040

text: A mutual insurer may borrow money to defray the expenses of its organization, provide it with surplus funds, or for any purpose of its business, upon a written agreement that the money is required to be repaid only out of the insurer’s surplus in excess of that stipulated in the agreement. The agreement may provide for fixed or variable interest not exceeding an amount allowed by the commissioner, which interest shall or shall not constitute a liability of the insurer as to its funds other than the excess that is stipulated in the agreement. Any agreement of this type shall provide that all interest payments and principal repayments require prior approval by the commissioner. Unless otherwise approved by the commissioner, written agreements evidencing this borrowed money shall not be issued in units of less than ten thousand dollars ($10,000). Unless otherwise allowed by the commissioner, no commission or promotion expense shall be paid in connection with any loan of this type. An agreement to borrow money to provide surplus funds, or for any business purpose, may be termed a surplus note. No surplus note or other agreement may be issued unless it conforms to the requirements set forth at the time the note is issued in the Accounting Practices and Procedures Manual adopted by the National Association of Insurance Commissioners for the reporting of agreements as surplus and not as debt in the financial statements required to be filed by an insurer with the commissioner. No permit or other agreement shall constitute authorization or approval for any other issuance of securities that is connected to the note or agreement in any way.

history: (History: Amended by Stats. 2004, Ch. 4, Sec. 2. Effective January 21, 2004.)

article: 4. Loans

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 4. General Mutual Insurers > 4. Loans


citation: INS § 4042

text: The issuance of any document evidencing any such loan shall require the commissioner’s securities permit under Article 8 of Chapter 1, Part 2, Division 1 (commencing with Section 820).

article: 4. Loans


citation: INS § 4044

text: This section shall not apply to loans obtained by the insurer in ordinary course of business from banks and other financial institutions, nor to loans secured by pledge or mortgage of assets.

article: 4. Loans


citation: INS § 4050

text: The directors of a domestic mutual insurer may from time to time apportion and pay or credit to its members dividends only out of that part of its surplus funds which represents net realized savings, net realized earnings, and net realized capital gains, all in excess of a surplus equivalent to the aggregate of paid-in capital and unassigned surplus required by this code for the issuance of a certificate of authority to a capital stock insurer transacting the same classes of insurance.

article: 5. Dividends to Policyholders

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 4. General Mutual Insurers > 5. Dividends to Policyholders


citation: INS § 4051

text: A dividend otherwise proper may be payable out of such savings, earnings, and gains even though the insurer’s total surplus is then less than the aggregate of contributed surplus remaining unpaid by the insurer.

article: 5. Dividends to Policyholders


citation: INS § 4052

text: The payment of any such dividends on a workers’ compensation policy shall be subject to the provisions of Section 11738 and for that purpose a mutual policy shall be considered to be a participating policy.

history: (History: Amended by Stats. 2018, Ch. 231, Sec. 13. (AB 2045) Effective January 1, 2019.)

article: 5. Dividends to Policyholders


citation: INS § 4060

text: A domestic mutual insurer while maintaining unimpaired surplus funds not less in amount than one and one-half times the minimum paid-in capital stock required of a domestic stock insurer formed under this code for authority to transact the same class or classes of insurance, may, upon receipt of the commissioner’s certificate so authorizing, extinguish the contingent liability to assessment of its members as to all its policies in force and may omit provisions imposing contingent liability in all policies currently issued. A fee of two hundred eighty-three dollars ($283) shall accompany any application for that certificate.

history: (History: Amended by Stats. 2017, Ch. 534, Sec. 52. (AB 1699) Effective January 1, 2018.)

article: 6. Nonassessable Policies

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 4. General Mutual Insurers > 6. Nonassessable Policies


citation: INS § 4061

text: The commissioner shall not authorize a domestic insurer to extinguish the contingent liability of any of its members or in any of its policies to be issued, unless it qualifies to and does extinguish such liability of all its members and in all such policies for all kinds of insurance transacted by it. No assessment shall be levied against any member or subscriber with respect to any nonassessable policy issued when the insurer had an unrevoked certificate to issue nonassessable policies.

article: 6. Nonassessable Policies


citation: INS § 4062

text: A foreign or alien mutual insurer may issue nonassessable policies to its members in this State pursuant to its charter and the laws of its domicile.

article: 6. Nonassessable Policies


citation: INS § 4063

text:
The commissioner shall revoke the certificate of a domestic mutual insurer to issue policies without contingent liability if

(a) At any time the insurer’s assets are less than the sum of its liabilities and the surplus required for such certificate, or

(b) The insurer, by resolution of its board of directors approved by a majority of its members, requests that the certificate be revoked.

article: 6. Nonassessable Policies


citation: INS § 4064

text: During the absence of such certificate the insurer shall not issue any policy without providing therein for the contingent liability of the policyholder, nor renew any policy which is then in force without endorsing the same to provide for such contingent liability.

article: 6. Nonassessable Policies


citation: INS § 4070

text: Such an insurer is insolvent if its surplus becomes less than the amount of paid-in capital required of a capital stock company to qualify to transact the same classes of insurance.

article: 7. Insolvency

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 4. General Mutual Insurers > 7. Insolvency


citation: INS § 4080

text: Such an insurer shall be subject to all the provisions of this code and all the applicable rules and regulations of the commissioner. Such code provisions and such rules and regulations, when applied to such insurers, shall be construed in accordance with the fundamental nature of a mutual insurer. In the event of any direct conflicts between such code provisions and the provisions of this chapter, the latter shall prevail. Such other code provisions may, however, be used to supplement or explain the provisions of this chapter.

article: 8. Applicable Insurance Laws

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 4. General Mutual Insurers > 8. Applicable Insurance Laws


citation: INS § 4081

text:
Any county mutual fire insurer, or two or more such insurers, may merge into a general mutual insurer described in this chapter by following the procedure in Article 9.5 (commencing with Section 7040) of Chapter 5, Part 1, Division 2 of this code. Such general mutual insurer shall become the surviving corporation.

In addition, by following the above-mentioned procedure any two or more county mutual fire insurers may merge, concurrently with the transformation of one of them into a general mutual insurer described herein, as provided in Section 7044. 5.

history: (History: Added by Stats. 1967, Ch. 455.)

article: 8. Applicable Insurance Laws


citation: INS § 4090

text: By following the procedure specified in this article, any domestic mutual insurer described in this article may merge, consolidate, or otherwise unite with or become a part of, or may reinsure all of its policies with and, upon assumption of all of its liabilities, may transfer all of its assets to, another insurer, domestic or foreign. Chapter 13 (commencing with Section 1300) of Division 1 of Title 1 of the Corporations Code and Article 1 (commencing with Section 11535) of Chapter 14 of Part 2 of Division 2 do not apply to any such transaction.

history: (History: Amended by Stats. 1995, Ch. 728, Sec. 4. Effective January 1, 1996.)

path: 2. CLASSES OF INSURANCE > 1. FIRE AND MARINE INSURANCE > 4. General Mutual Insurers > 9. Merger, Consolidation, Reinsurance, or Transfer of Assets and Liabilities


citation: INS § 4091

text:
The plan and agreement by which any such transaction is to be effected shall be approved by a resolution of the majority of the board of directors of each domestic mutual insurer reciting the reasons for and the purposes of the proposed transaction and the manner in which the transaction is expected to benefit and serve the best interests of the domestic mutual insurer and its members. The plan and agreement shall thereafter be submitted to the commissioner, who shall examine the same and require such provisions to be inserted in the agreement and such actions to be taken in connection with the transaction including, but not limited to the following:

(a) The terms and conditions of the transaction.

(b) Any fee, commission, or other valuable consideration whatsoever, other than regular salary and compensation paid to any director, officer, agent, or employee of the domestic mutual insurer in connection with the transaction.

(c) At the expense of the applicant, an opinion as to the fairness of the terms of the plan and an appraisal of the fair value of each insurer, together with the respective equity interests of the members therein, by one or more qualified disinterested persons appointed by the domestic mutual insurer with the approval of the commissioner unless the commissioner finds that such an opinion or appraisal is not necessary to protect the interests of current members of the domestic mutual insurer.

(d) The contents of the notice of the vote on the transaction by the members of each domestic mutual insurer that is a party thereto.

(e) The manner and form of voting thereon by the members of each such domestic mutual insurer.

(f) Any other change as the commissioner may deem necessary in order that the transaction may be fair, just, and equitable to the parties to the transaction and their respective policyholders, owners, creditors, and the public.

history: (History: Amended by Stats. 1995, Ch. 728, Sec. 5. Effective January 1, 1996.)

article: 9. Merger, Consolidation, Reinsurance, or Transfer of Assets and Liabilities