citation: INS § 1774

text:
(a) (1) On or before the first day of March of each year the surplus line broker, placing business for a home state insured, shall file with the commissioner a sworn statement of all business transacted under his or her surplus line license during the last preceding calendar year. The statement shall contain an account of the business done by the surplus line broker placing business for a home state insured for the prior year, and shall include (A) the total amount of gross premium, (B) the total gross premium for single state risks where 100 percent of the premium is attributable to risks in California, and (C) for multistate risks, the percentage of gross premium allocated to California and each other state. The commissioner may waive or modify any of the foregoing requirements by issuance of a notice published on the department’s Internet Web site.

(2) On or before the first day of March of each year, the home state insured that directly procures insurance pursuant to Section 1760 shall file with the commissioner a sworn statement of all business done during the last preceding calendar year. That statement shall contain an account of the insurance directly procured by the home state insured pursuant to Section 1760 for the prior year, and shall include (A) the total amount of premium, (B) the total premium for single state risks where 100 percent of the premium is attributable to risks in California, and (C) for multistate risks, the percentage of premium allocated to California and each other state. The commissioner may waive or modify any of the foregoing requirements by issuance of a notice published on the department’s Internet Web site.

(b) For purposes of this chapter, “business done” or “business transacted” means all insurance business conducted by the surplus line broker for a home state insured or directly procured by the home state insured. If two or more persons licensed as surplus line brokers are involved in placing a policy, only the one who is responsible for filing the confidential written report pursuant to subdivision (a) of Section 1763, shall be considered transacting business for tax purposes and then only one licensed surplus line broker shall include the policy in his or her sworn statement. The surplus line broker who is required to include the policy in his or her own statement is either (1) the one who is responsible for negotiating, effecting the placement, remitting the premium to the nonadmitted insurer or its representatives, and filing the confidential written report pursuant to subdivision (a) of Section 1763, or (2) the one surplus line broker who is delegated the responsibility for the filing of the confidential written report pursuant to subdivision (a) of Section 1763 pursuant to a written agreement that is (A) by and among the surplus line brokers referenced in paragraph (1) and this paragraph involved in the transaction, (B) signed by the surplus line brokers referenced in paragraph (1) and this paragraph involved in the transaction, and (C) provides by its terms that the agreement shall be made available to the commissioner or his or her designee, upon request.

(c) The date on which the surplus line broker transacting a policy prepares a bill or invoice for payment of all or part of the premiums due, shall be considered the date on which that business was done or transacted, subject to subdivision (d). This date shall be shown on the face of the bill or invoice and shall be referred to as the “invoice date.”

(d) (1) The invoice date shall be no more than 60 days after the policy effective date and no more than 60 days after the insurance was placed with a nonadmitted insurer, except as provided in paragraph (2).

(2) For purposes of this chapter, the amount of gross premium to be reported, if premiums are billed and payable in installments, shall be the amount of the installment premium, provided the amount and due date of each installment, or the basis for determining each installment, is identifiable in the policy or an endorsement, and either of the following conditions is satisfied:

(A) Installments under the policy are not billed more frequently than once per month.

(B) If more than one installment is billed in any month, the commissioner determines, in his or her discretion, that the installment billing method used does not unduly burden the commissioner’s ability to accurately determine the amount of premium paid by the insured.

(3) If a new or renewal policy has an effective date between January 1, 2011, to July 20, 2011, inclusive, and is placed on or before July 20, 2011, then the policy shall be considered to be business done by the surplus line broker as of the effective date. If a new or renewal policy has an effective date between January 1, 2011, to July 20, 2011, inclusive, then the policy shall be considered to be business done by the home state insured who directly procures policies as of the effective date. Cancellations or endorsements shall be business done on the same date as the policy that is being canceled or endorsed, if that policy effective date is on or before July 20, 2011. Installment premiums, as referenced in paragraph (2), shall be business done on the date of the most recent invoice issued on or before July 20, 2011, that included premium tax charges. This paragraph is enacted to address the July 21, 2011, effective date of the federal Dodd-Frank Wall Street Reform and Consumer Protection Act (P.L. 111-203), and shall remain in effect only until October 18, 2012.

history: (History: Amended by Stats. 2012, Ch. 162, Sec. 109. (SB 1171) Effective January 1, 2013.)


kind: section

code: INS

citation: INS § 1775

text: All such reports and statements shall be made on blanks furnished to the surplus line broker by the commissioner on application therefor.

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

division: 1. GENERAL RULES GOVERNING INSURANCE

part: 2. THE BUSINESS OF INSURANCE

chapter: 6. Surplus Line Brokers

path: 1. GENERAL RULES GOVERNING INSURANCE > 2. THE BUSINESS OF INSURANCE > 6. Surplus Line Brokers


text:
(a) Each calendar year, every surplus line broker whose annual tax for the preceding calendar year was twenty thousand dollars ($20,000) or more shall make monthly installment payments on account of the annual tax on business done during the current calendar year imposed by Section 1775.5.

(b) Notwithstanding any other law, the commissioner may relieve a surplus line broker of his or her obligation to make monthly payments if the broker establishes to the satisfaction of the commissioner that either the broker has ceased to transact business in this state, or his or her annual tax for the current year will be less than twenty thousand dollars ($20,000).

history: (History: Amended by Stats. 2014, Ch. 362, Sec. 4. (AB 2734) Effective January 1, 2015.)


text: On or before February 1 of each year, the commissioner shall post on the department’s Internet Web site the installment payment forms prescribed by the commissioner to accompany surplus line tax remittances if monthly installment payments are required by Section 1775.1. Failure to secure those forms shall not relieve any broker from making or paying monthly installment payments.

history: (History: Amended by Stats. 2005, Ch. 312, Sec. 6. Effective January 1, 2006.)


text: Each surplus line broker required to make monthly installment payments shall remit them on or before the first day of the third calendar month following the end of the accounting month in which the business was done. The annual payment under Section 1775.5 shall be in lieu of an installment payment under this section for the accounting month of December. Remittances for those payments shall be made payable to the commissioner and shall be made by electronic fund transfer in accordance with Section 1775.8 or delivered to the office of the commissioner, accompanied by an installment payment form prescribed by the commissioner if remittance by electronic fund transfer is not mandatory under Section 1775.8.

history: (History: Amended by Stats. 1994, Ch. 455, Sec. 4. Effective January 1, 1995.)


text:
(a) The amount of the payment shall be 3 percent of the gross premiums charged less return premiums upon business done by the surplus line broker during the calendar month ending two calendar months immediately preceding the due date of the payment, as specified in Section 1775.3, excluding gross premiums and return premiums paid by him or her upon business governed by the provisions of Section 1760.5. If during any calendar month those return premiums upon business done by a surplus line broker exceed the gross premiums upon the business done by him or her in that calendar month, then no payment shall be payable by him or her in respect to that calendar month, and he or she may carry forward that excess to the next succeeding calendar month or months and apply it in reduction of the taxable premiums on business done by him or her in that succeeding calendar month or months. Even though no payment shall be payable by the broker, he or she shall file a return showing that his or her return premiums exceeded his or her gross premiums.

(b) In determining the applicability of subdivision (a) of Section 1775.1 to a surplus line broker who has acquired the business of another surplus line broker, the amount of tax liability of the acquired broker for the immediately preceding calendar year shall be added to the amount of the tax liability of the acquiring broker for the immediately preceding calendar year.

(c) All amounts paid, other than penalties and interest, shall be allowed as a credit on the annual tax imposed by Section 1775.5.

(d) If the total amount of monthly installment payments for any calendar year exceeds the amount of annual tax for that year, the excess shall be treated as an overpayment of annual tax and be allowed as a credit or refund.

(e) A penalty of 10 percent of the amount of the monthly payment due shall be levied upon and paid by any surplus line broker who fails to make the necessary payment within the time required, plus interest at the rate of 1 percent per calendar month or fraction thereof from the due date of the payment until the date payment is received by the commissioner, but not for any period after the due date of the annual tax. The penalty and interest shall be applied as prescribed in Section 12636.5 of the Revenue and Taxation Code. The commissioner may remit the penalty in a case where he or she finds, as a result of examination or otherwise, that the failure of, or delay in, payment arose out of excusable mistake or excusable inadvertence.

(f) For any part of a payment required that was not made within the time required by law, when the nonpayment or late payment was due to fraud on the part of the taxpayer, a penalty of 25 percent of the amount unpaid shall be added thereto, in addition to all other penalties otherwise imposed.

(g) The commissioner, upon a showing of good cause, may extend for not to exceed 10 days the time for making a monthly payment. The extension may be granted at any time, provided that a request therefor is filed with the commissioner within or prior to the period for which the extension may be granted. Any surplus line broker to whom an extension is granted shall, in addition to the monthly payment, pay interest at the rate of 1 percent per month, or fraction thereof, from the due date until the annual tax due date.

history: (History: Amended by Stats. 2011, Ch. 83, Sec. 28. (AB 315) Effective July 15, 2011. Operative July 21, 2011, by Sec. 34 of Stats. 2011, Ch. 83.)


text:
(a) Every surplus line broker shall annually, on or before the first day of March of each year, pay to the Insurance Commissioner for the use of the State of California a tax of 3 percent of the gross premiums charged less return premiums upon business done by him or her under the authority of his or her license during the preceding calendar year, excluding any portions of premiums upon business done involving the risk finance portion of any blended finite risk product used in the financing element of state or federal Superfund environmental settlements involving remediation of soil or groundwater contamination or by the provisions of Section 1760.5. If during any calendar year 3 percent of the return premiums upon business done by a surplus line broker exceed 3 percent of the gross premiums upon that business done by him or her in that year, then he or she may either carry forward that excess to the next succeeding year and apply it as a credit against 3 percent of gross premiums on the business done by him or her in the succeeding year, or he or she may elect to receive, and thereupon be paid a refund equal to the amount of taxes theretofore paid by him or her on that excess of return premiums paid over gross premiums received.

(b) For the purpose of determining that tax, the total premium charged for all that nonadmitted insurance placed in a single transaction with one underwriter or group of underwriters, whether in one or more policies, shall be the entire premium charged on all nonadmitted insurance for the California home state insured. This provision shall not apply to interstate motor transit operations conducted between this and other states. With respect to those operations surplus line tax shall be payable on the entire premium charged on all nonadmitted insurance, less the following:

(1) The portion of the premium as is determined, as herein provided, to have been charged for operations in other states taxing the premium on operations in those states of an insured maintaining its headquarters office in this state.

(2) The premium for any operations outside of this state of an insured who maintains a headquarters operating office outside of this state and a branch office in this state.

(c) (1) A penalty of 10 percent of the amount of the payment due pursuant to this section shall be levied upon and paid by any surplus line broker who fails to make the necessary payment within the time required, plus interest at the rate of 1 percent per calendar month or fraction thereof, from March 1, the due date of the annual tax, until the date the payment is received by the commissioner. The penalty and interest shall be applied as prescribed in Section 12636.5 of the Revenue and Taxation Code. The commissioner, upon a showing of good cause, may extend for a period not to exceed 30 days, the time for filing a tax return or paying any amount required to be paid with the return. The extension may be granted at any time, provided that a request therefor is filed with the commissioner within, or prior to, the period for which the extension may be granted.

(2) Any surplus line broker to whom an extension is granted shall, in addition to the tax, pay interest at the rate of 1 percent per month or fraction thereof from March 1, until the date of payment. The commissioner may remit the penalty in a case where the commissioner finds, as a result of examination or otherwise, that the failure of or delay in payment arose out of excusable mistake or excusable inadvertence.

(d) For any part of a payment required by this section or by Section 1775.4 which was not made within the time required by law, when the nonpayment or late payment was due to fraud on the part of the broker, a penalty of 25 percent of the amount unpaid shall be added thereto, in addition to all other penalties otherwise imposed.

(e) For the purposes of this section, these terms shall have the following meanings:

(1) “Blended finite risk product” means a contractual arrangement combining risk finance with traditional risk transfer, where a distinct portion of the program cost represents the funding of a known, existing, nonfortuitous future cost, obligation, responsibility, or liability at its discounted net present value, and another portion of the program cost represents risk transfer for losses that have yet to occur related to the cost, obligation, responsibility, or liability that is the subject of the program.

(2) “Risk financing” means that portion of any blended finite risk product that represents the funding of a known, existing, nonfortuitous future cost, obligation, responsibility, or liability.

(3) “Risk finance” or “financing element” means a method of funding for a known future cost over a long time horizon in current-value dollars using the principle of net present value discounting.

history: (History: Amended by Stats. 2012, Ch. 162, Sec. 110. (SB 1171) Effective January 1, 2013.)


text: All tax moneys received by the commissioner pursuant to this chapter shall be transmitted to the State Treasurer to be deposited in the State Treasury to the credit of the Insurance Tax Fund. Upon transmitting moneys to the State Treasurer, the commissioner shall furnish the Controller with a record of the amount transmitted and the surplus line brokers from whom the moneys have been received.

history: (History: Added by Stats. 1963, 1st Ex. Sess., Ch. 4.)


text:
The money in the Insurance Tax Fund received from the commissioner pursuant to Section 1775.6 is hereby appropriated as follows:

(a) To pay the refunds authorized by this chapter.

(b) The balance of the money in the fund shall, on order of the Controller, be transferred to the State General Fund.


text:
(a) On and after January 1, 1994, and before January 1, 1995, every surplus line broker whose annual taxes for business done in calendar year 1992 or whose quarterly taxes for business done in calendar year 1993 exceed fifty thousand dollars ($50,000) shall make payment by electronic funds transfer. On and after January 1, 1995, every surplus line broker whose annual taxes for business done in calendar year 1993 or in any calendar year thereafter exceed twenty thousand dollars ($20,000) shall make payment by electronic funds transfer. The surplus line broker shall choose one of the acceptable methods described in Section 45 for completing the electronic funds transfer.

(b) Payment is deemed complete on the date the electronic funds transfer is initiated, if settlement to the state’s demand account occurs on or before the banking day following the date the transfer is initiated. If settlement to the state’s demand account does not occur on or before the banking day following the date the transfer is initiated, payment is deemed to occur on the date settlement occurs.

(c) (1) Any surplus line broker required to remit taxes by electronic funds transfer pursuant to this section who remits those taxes by means other than an appropriate electronic funds transfer, shall be assessed a penalty in an amount equal to 10 percent of the taxes due at the time of the payment.

(2) If the department finds that a surplus line broker’s failure to make payment by an appropriate electronic funds transfer in accordance with subdivision (a) is due to reasonable cause or circumstances beyond the surplus line broker’s control, and occurred notwithstanding the exercise of ordinary care and in the absence of willful neglect, that surplus line broker shall be relieved of the penalty provided in paragraph (1).

(3) Any surplus line broker seeking to be relieved of the penalty provided in paragraph (1) shall file with the department a statement under penalty of perjury setting forth the facts upon which the claim for relief is based.

history: (History: Added by renumbering Section 1776.8 by Stats. 1995, Ch. 721, Sec. 7. Effective January 1, 1996.)


text:
(a) If the commissioner determines that the amount of tax reported by the surplus line broker is less than the tax disclosed by the commissioner’s examination, the commissioner shall permit the surplus line broker to provide additional information demonstrating that the surplus line broker owes a lesser amount. If within 60 days, or such additional time as the commissioner deems appropriate, the commissioner and the surplus line broker cannot agree on the amount owed, the commissioner shall propose in writing to the State Board of Equalization a deficiency assessment for the difference pursuant to subdivision (b) of Section 12422 of the Revenue and Taxation Code.

(b) Section 12636.5, Article 3 (commencing with Section 12421) and Article 4 (commencing with Section 12491) of Chapter 4 of, and Article 1 (commencing with Section 12951) and Article 2 (commencing with Section 12977) of Chapter 7 of, Part 7 of Division 2 of the Revenue and Taxation Code shall apply to surplus line brokers, except where inconsistent with the provisions of this chapter, in which case this chapter shall govern.

history: (History: Amended by Stats. 2005, Ch. 231, Sec. 1. Effective January 1, 2006.)


citation: INS § 1776

text:
Any surplus line broker who willfully fails or refuses to report to the commissioner any insurance on subject matter located within this state placed under his or her name with nonadmitted insurers, or who, by willful omission from the records required to be maintained by him or her for that purpose, attempts to evade the payment of taxes on any such insurance, is, in addition to being required to pay the tax, together with a penalty equal in amount to the tax, guilty of a misdemeanor.

It is a misdemeanor for any surplus line broker or special lines’ surplus line broker to accept or pay directly or indirectly any consideration or remuneration for or in connection with the placing of insurance that, if done by a person within this state, is governed by the provisions of this chapter, when the placing was not done by a person licensed therefor pursuant to this chapter.

It is a misdemeanor for any agent or broker to solicit, negotiate, or effect any insurance governed by the provisions of this chapter in nonadmitted insurers, except by and through a surplus line broker or special lines’ surplus line broker licensed pursuant to this chapter. Except in the case of insurance specified in subdivision (b) of Section 1760.5, it is a misdemeanor for any surplus line broker or special lines’ surplus line broker to accept, place, pay, or permit the payment of commission or other remuneration on insurance placed by him or her under authority of his or her license to any person other than one holding a license to act as an insurance agent, insurance broker, surplus line broker, or special lines’ surplus line broker, except that the business may be accepted by such surplus line broker or special lines’ surplus line broker directly from an insured or other person who would likewise be entitled to place the business directly with an admitted insurer without the solicitation, negotiation, or effecting thereof by an insurance agent or broker.

The commissioner may deny, suspend, or revoke any license issued pursuant to this code if he or she finds after notice and hearing in accordance with the procedure provided in Article 13 (commencing with Section 1737) of Chapter 5 that the licensee has violated any provisions of this section.

The permission granted in this chapter to place any insurance in a nonadmitted insurer shall not be deemed or construed to authorize any insurer to do business in this state.

Placement activities of a licensed surplus line broker in accordance with this chapter, including, but not limited to, policy issuance, shall not be deemed or construed to be business done by the insurer in this state.

history: (History: Amended by Stats. 2004, Ch. 183, Sec. 240. Effective January 1, 2005.)


citation: INS § 1778

text: When a surplus line broker’s license is revoked for any reason other than the insufficiency of his sureties, a new license shall not be issued to him within one year after such revocation and until all indebtedness of the broker on former business has been paid to the commissioner.


citation: INS § 1779

text: Every California home state insured for whom insurance has been effected with nonadmitted insurers shall, upon request in writing by the commissioner, produce for the commissioner’s examination all policies, contracts, and other documents evidencing that insurance, and shall disclose to the commissioner the amount of the gross premiums paid or agreed to be paid for that insurance. For refusal to obey that request, the insured shall forfeit to the State of California the sum of one thousand dollars ($1,000) for each refusal.

history: (History: Amended by Stats. 2011, Ch. 83, Sec. 30. (AB 315) Effective July 15, 2011. Operative July 21, 2011, by Sec. 34 of Stats. 2011, Ch. 83.)


citation: INS § 1780

text: A licensee or applicant for a license under this chapter shall notify the commissioner, in writing, of any change in the address from which he intends to conduct his business.

history: (History: Added by Stats. 1957, Ch. 671.)


text:
(a) The Legislature finds and declares that consumers in the State of California have insurance needs which cannot always be met through the admitted insurance market. For this reason, many insurance consumers need access to insurance underwritten by nonadmitted insurers, as permitted by law. To help ensure that insurance consumers have access to financially sound and reputable nonadmitted insurers, it is in the public interest to authorize a surplus line advisory organization within the State of California to perform certain duties delegated by the Insurance Commissioner, as provided in this chapter.

(b) The Legislature further finds and declares that it is in the public interest for the surplus line advisory organization authorized under this chapter to be composed of surplus line brokers or persons involved in the business of surplus line insurance. The advisory organization’s activities shall constitute an integral part of the business of insurance. The advisory organization will facilitate the state’s ability to monitor and regulate the transfer of risk on a sound basis through surplus line brokers to nonadmitted insurers in accordance with Chapter 6 (commencing with Section 1760) and may perform certain functions in this state’s system of monitoring and regulating the persons and entities involved in this state in the surplus line segment of the insurance industry.

(c) The Legislature further finds and declares that the authorization of a surplus line advisory organization to perform the duties delegated by the Insurance Commissioner, as provided in this chapter, will further the policies of the State of California expressed in the findings set forth in this section. The oversight, supervision, and examination by the Insurance Commissioner provided for in this chapter are intended to subject the activities of the advisory organization to active state supervision.

(d) The Legislature further finds and declares that, as it is the obligation and duty of the elected Insurance Commissioner to regulate the business of insurance in the State of California, it is in the public interest to grant the Insurance Commissioner the authority and discretion to utilize the expertise and knowledge of a surplus line advisory organization to assist in carrying out that responsibility, as provided in this chapter.

history: (History: Added by Stats. 1993, Ch. 1007, Sec. 1. Effective January 1, 1994.)

chapter: 6.1. Surplus Line Advisory Organization

path: 1. GENERAL RULES GOVERNING INSURANCE > 2. THE BUSINESS OF INSURANCE > 6.1. Surplus Line Advisory Organization


text:
(a) As used in this chapter, “surplus line advisory organization” shall mean the organization authorized to perform the duties delegated by the commissioner under this chapter and to exercise the authority incidental thereto.

(b) All references in this chapter to “advisory organization” shall mean “surplus line advisory organization.”

(c) As used in this chapter, the term “surplus line law” shall refer to Chapter 6 (commencing with Section 1760).

(d) All references in this chapter to the “commissioner” shall mean the Insurance Commissioner of the State of California.


text:
(a) The surplus line advisory organization shall be deemed a joint arrangement established by statute to assure the availability of insurance on a sound basis under paragraph (2) of subdivision (b) of Section 1861.03.

(b) All surplus line brokers licensed under the surplus line law shall be deemed to be members of the advisory organization.

(c) Any member of the National Association of Registered Agents and Brokers, licensed as a surplus line broker in his, her, or its home state of residence or business and paying the applicable California license fee, shall be deemed to be members of the advisory organization. This subdivision shall not be effective unless and until the advisory organization recognizes in writing the National Association of Registered Agents and Brokers is incorporated and operating under its board-adopted bylaws.

history: (History: Amended by Stats. 2017, Ch. 477, Sec. 2. (AB 1641) Effective January 1, 2018.)


text: The commissioner shall remain fully responsible for supervising the implementation and administration of the surplus line law and for all regulatory decisions and initiatives in connection therewith, and nothing in this chapter shall be deemed or construed to diminish or impair the commissioner’s authority and responsibility.


text:
To be authorized to perform the duties delegated by the commissioner under this chapter and to exercise the authority incidental thereto, an organization must satisfy the requirements of this section.

(a) The organization must be a private, nonprofit organization that has all the following qualifications:

(1) Experience in professional surplus line brokerage, advisory, and regulatory activity in California or whose members possess that experience.

(2) The administrative capability and recordkeeping facilities to process all surplus line filings in California.

(3) The data processing capability and the necessary personnel to perform appropriate security review of all nonadmitted insurers.

(4) The capability to perform the duties that may be delegated by the commissioner under this chapter and to exercise the authority incidental thereto.

(b) An organization that has the qualifications described in subdivision (a) must file with the commissioner all of the following:

(1) A copy of its constitution, its articles of agreement or association, or its certificate of incorporation.

(2) A copy of its bylaws, if any.

(3) A current list of its members.

(4) The name and address of a resident of this state as agent for service of process.

(5) A plan of operation identifying the duties set forth in Section 1780.56 that the organization proposes to perform and describing how the organization will perform those duties.

(6) Any other documents, evidence, or information necessary to show that the organization complies with the provisions of this chapter.

(c) The advisory organization shall file with the commissioner every material change in the documents required by subdivision (b), including every amendment to its plan of operation required by subdivision (d).

(d) The advisory organization’s plan of operation shall be amended whenever necessary to conform to and effectuate the purposes of any amendments to this chapter or to the surplus line law or the regulations pertaining thereto. Further, the plan of operation shall be amended in response to any written request reasonably made by the commissioner to improve the advisory organization’s effectiveness in performing the duties delegated by the commissioner under this chapter. The commissioner’s requests under this subdivision shall be consistent with technical and economic feasibility and established techniques or practices for performing the types of activities encompassed by the duties delegated by the commissioner.


text:
(a) Within 120 days after the filing of the documents required by subdivision (b) of Section 1780.54, the commissioner shall notify the organization in writing of the commissioner’s determination to approve or disapprove the organization’s qualifications and its plan of operation and which, if any, of the duties identified in the plan of operation the commissioner has determined to delegate to the organization. The commissioner and the organization shall confer to resolve any and all issues that the commissioner may raise concerning the organization’s qualifications, its plan of operation, or which duties should be delegated to the organization. Any determination by the commissioner to disapprove the organization’s qualifications or plan of operation or not to delegate one or more of the duties identified in the plan of operation shall be accompanied by a statement of the commissioner’s reasons therefor.

(b) The commissioner may provisionally approve the organization’s qualifications and plan of operation and may provisionally delegate one or more of the duties identified in the plan of operation pending the commissioner’s determinations under subdivision (a).

(c) Upon approval of the organization’s qualifications and plan of operation and upon delegation to the organization of one or more of the duties identified in the plan of operation, the organization shall commence operations as the advisory organization under this chapter, consistent with the duties delegated by the commissioner. In the event of provisional approval and delegation pursuant to subdivision (b), the organization shall operate as the advisory organization under this chapter during the period of, and consistent with, the provisional approval and delegation by the commissioner.

(d) Any amendment to the advisory organization’s plan of operation that is required by subdivision (d) of Section 1780.54 shall be approved or disapproved pursuant to the procedures set forth in this section.

(e) The time periods set forth in this section may be extended by consent of the organization and the commissioner.

(f) The decision whether to delegate or withdraw one or more of the duties identified in the plan of operation is committed to the commissioner’s sound discretion. The commissioner may, upon not less than one year’s notice to the advisory organization, withdraw one or more functions that have been delegated to the advisory organization in order that any one or more functions so withdrawn may be performed by the Department of Insurance.


text:
(a) The commissioner may delegate one or more of the following duties to a qualified surplus line advisory organization under this chapter:

(1) To receive, review, and record all documents required by law, regulation, or order to be filed with the commissioner or his or her designee with respect to foreign and alien nonadmitted insurers and any insurance placed with nonadmitted insurers, except that the advisory organization shall not receive documents submitted pursuant to subdivision (c) of Section 1763. The review under this subdivision shall be for completeness, accuracy, and any other matters the commissioner reasonably may direct the advisory organization to review. The advisory organization shall notify the filing surplus line broker in writing of any filing that the advisory organization determines to be incomplete or inaccurate, and shall request the filing broker to correct the problem. The advisory organization may, or as directed by the commissioner shall, notify the commissioner of incomplete or inaccurate filings.

(2) To conduct a security review and analysis as directed by the commissioner, and to provide to the commissioner, and if directed by the commissioner, to the NAIC, a report on any nonadmitted insurer based on that review and analysis. The review and analysis under this subdivision shall take account of any matters the commissioner reasonably may direct the advisory organization to review and any other matters the advisory organization considers necessary or appropriate.

(3) To make confidential recommendations to the commissioner and, if directed by the commissioner, to the NAIC, as to the suitability of any foreign or alien nonadmitted insurer to insure property or risks located or persons residing in this state or whether any foreign or alien nonadmitted insurer should be eligible or ineligible or approved pursuant to Section 1765.2. The advisory organization’s recommendations shall be based on any review and analysis that it performs under this chapter and on any additional information that may come to the advisory organization’s attention or that the commissioner reasonably may request the advisory organization to consider.

(4) To report to the commissioner and other appropriate authorities instances of actual fraudulent or illegal insurance activity in the surplus line market that come to the advisory organization’s attention and any facts that come to the advisory organization’s attention that, in the reasonable judgment of the advisory organization, may indicate the presence of fraudulent or illegal insurance activity in the surplus line market or potential risk of harm to consumers of surplus line insurance.

(5) To maintain and report information necessary or that reasonably may be requested by the commissioner for the calculation and collection of premium taxes on surplus line insurance premiums.

(6) To respond to any request by the commissioner for comments on any proposed legislation or regulation affecting the placement of insurance pursuant to the surplus line law.

(7) To receive and disseminate to its members information relating to surplus line insurance, to educate its members about the surplus line law and the regulations pertaining thereto, and to perform any specific educational activities that the commissioner reasonably may request.

(8) To communicate with organizations of admitted insurers with respect to the proper use of the surplus line market.

(9) To enter into written arrangements with the commissioner whereby the advisory organization will perform any other functions that, in the judgment of the commissioner and the advisory organization, will help the commissioner provide effective and cost-efficient supervision of the surplus line market.

(b) If the commissioner delegates to the advisory organization one or more of the duties set forth in subdivision (a), the advisory organization also shall be authorized to assess a stamping fee for each policy, declarations page, cover note, or other premium bearing document submitted to the advisory organization. The stamping fee shall be established from time to time by the governing body of the advisory organization, shall reflect all reasonable costs associated with the services provided by the advisory organization, and may be reviewed by the commissioner for reasonableness as part of the commissioner’s examination of the advisory organization. Except as otherwise provided in this subdivision, the stamping fee may not exceed three-fourths of 1 percent of the premium for the insurance. Any proposed increase in the stamping fee above three-fourths of 1 percent shall be filed with the commissioner along with a written explanation of the reason for the increase, and the increase shall take effect upon the expiration of 60 days after the date of filing unless the commissioner disapproves it within that time. Within 60 days after the date of filing, the commissioner may provisionally approve the proposed increase, in which event the increase shall take effect immediately. The proposed increase shall be deemed fully approved upon the expiration of 120 days after the date of filing unless the commissioner disapproves the proposed increase within that time. The stamping fee shall be paid by the surplus line broker, provided, however, that the surplus line broker shall be allowed to receive and collect the stamping fee from the insured.

(c) Nothing in this chapter shall affect any delegation by the commissioner pursuant to the surplus line law, provided, however, that once the commissioner delegates one or more of the duties set forth in this section and the advisory organization commences operations under this chapter, no other organization may simultaneously perform the same duties under this chapter or exercise the authority incidental thereto.

(d) The advisory organization may cease performing the duties delegated by the commissioner under this chapter and exercising the authority incidental thereto at any time upon 180 days’ written notice to the commissioner. The commissioner may require the advisory organization to continue performing the duties under this chapter for up to an additional 180 days, and the commissioner shall be entitled, following receipt of notice from the advisory organization under this subdivision, to obtain copies of all unprivileged files, documents, and records maintained by the advisory organization on behalf of the commissioner under this chapter.

(e) The commissioner’s findings, determinations, rules, rulings, and orders under this chapter shall apply only to the advisory organization’s right to perform the duties delegated by the commissioner under this chapter and to exercise the authority incidental thereto. Nothing in this chapter shall be deemed or construed to affect the advisory organization’s right to exist and function as a private, nonprofit organization, with all powers attendant thereto, and to engage in lawful activities other than under the authority of this chapter.

history: (History: Amended by Stats. 2011, Ch. 83, Sec. 31. (AB 315) Effective July 15, 2011. Operative July 21, 2011, by Sec. 34 of Stats. 2011, Ch. 83.)


text:
If the commissioner delegates to the surplus line advisory organization one or more of the duties set forth in Section 1780.56, the advisory organization also shall be authorized to exercise the authority, in connection with those duties and incidental thereto:

(a) To facilitate and encourage compliance by its members with the laws of California and the rules and regulations of the commissioner relating to surplus line insurance.

(b) To maintain files for all documents received under this chapter and any other files the commissioner reasonably may direct the advisory organization to maintain.

(c) To provide comments on any proposed legislation or regulation.

(d) To make contracts necessary or appropriate to effect the purposes of this chapter and to perform the duties delegated by the commissioner under this chapter and to exercise the authority incidental thereto.

(e) To employ and retain whatever persons are necessary to perform the duties delegated by the commissioner under this chapter and to exercise the authority incidental thereto.

(f) To perform any other acts necessary or appropriate to monitor the surplus line business and to effect the purposes of this chapter as well as the surplus line law and the regulations pertaining thereto, consistent with the duties delegated by the commissioner under this chapter.


text:
(a) The surplus line advisory organization shall be subject to the supervision of the commissioner, including, but not limited to, the powers of the commissioner pursuant to Article 6.5 (commencing with Section 790) of Chapter 1 of Part 2 of Division 1, and Article 1 (commencing with Section 12919) of Chapter 2 of Division 3.

(b) The advisory organization shall prepare and submit an annual report on the performance of its duties under this chapter in the form and manner required by the commissioner and may advise the commissioner from time to time concerning any other matters relevant to its duties or the regulation of the surplus line market.

(c) The commissioner shall, at least once every three years, make or cause to be made an examination of the advisory organization, including the reasonableness of its costs. The examination may be made by independent auditors retained for that purpose by the commissioner. The reasonable cost of the examination shall be paid to the commissioner or, if the commissioner retains independent auditors for that purpose, directly to the independent auditors, by the advisory organization upon presentation by the commissioner, or by the independent auditors, of a detailed account of the cost. The commissioner shall furnish two copies of the examination report to the advisory organization.

(d) Within 20 days of receiving the commissioner’s examination report, the advisory organization may request a hearing on the report or on any facts or recommendations contained therein by mailing written notice to the commissioner specifying the matters to be considered at the hearing. The commissioner shall hold a hearing within 60 days on those aspects of the examination report and on any other aspects of the report that the commissioner designates for consideration.


text:
(a) If, as a result of the commissioner’s examination of the surplus line advisory organization or otherwise, there is good cause to believe that the advisory organization does not comply with any provision of this chapter or with any written request reasonably made by the commissioner pursuant to the provisions of this chapter, the commissioner shall give notice in writing to the advisory organization, stating in what manner and to what extent noncompliance is alleged to exist and specifying a reasonable time, not less than 10 days thereafter, in which the noncompliance may be corrected. Notices under this section shall be confidential as between the commissioner and the advisory organization unless a hearing is held under Section 1780.60.

(b) For purposes of this chapter, noncompliance includes any material failure by the advisory organization to perform adequately the duties delegated by the commissioner under this chapter or exercise properly the authority incidental thereto.


text:
(a) If there is good cause to believe that the surplus line advisory organization’s noncompliance with any provision of this chapter is willful, or if within the period prescribed by the commissioner in the notice required by subdivision (a) of Section 1780.59 the advisory organization does not make the changes necessary to correct the noncompliance specified by the commissioner or establish to the satisfaction of the commissioner that noncompliance does not exist, then the commissioner may hold a hearing in connection therewith, provided that within a reasonable period of time, which shall not be less than 30 days before the date of the hearing, the commissioner shall mail written notice specifying the matters to be considered at the hearing to the advisory organization. The notice shall conform to the requirements for an accusation as prescribed by Section 11503 of the Government Code. If no notice has been given as provided in subdivision (a) of Section 1780.59, notice shall be given as to the manner and extent of noncompliance that is alleged to exist. The hearing shall not include any subjects not specified in the notices required by subdivision (a) of Section 1780.59 or this section, except that if the hearing relates to or is based upon any aspect of the commissioner’s examination report on the advisory organization, the hearing shall also include any other aspect of the report that the advisory organization designates for consideration.

(b) In the event the commissioner reasonably determines that the advisory organization is engaged in fraudulent activity or malfeasance in the performance of the duties delegated by the commissioner under this chapter or in the exercise of the authority incidental thereto or otherwise is in violation of or noncompliance with any provision of this chapter, and that conduct has resulted, or is likely to result, in a significant, adverse, and immediate effect on the public or the commissioner’s ability to regulate the surplus line business that, because of the emergency nature of the effect on the public or the commissioner’s ability to regulate the surplus line business, cannot reasonably be remedied under the other provisions of this chapter, the commissioner may issue an order, without prior hearing, directing the advisory organization to cease and desist from the conduct or suspending or revoking all or part of the advisory organization’s authorization to perform the duties delegated by the commissioner under this chapter, in addition to imposing any other penalty provided for in this code. An order under this subdivision may, if necessary, also direct the advisory organization to preserve documents and records and to grant immediate access by the commissioner’s authorized representatives to the advisory organization’s premises to examine and make copies of any and all unprivileged documents and records of the advisory organization maintained on behalf of the commissioner pursuant to this chapter. Within five days after issuing an order under this subdivision, the commissioner shall issue the notice and shall thereafter hold the hearing under subdivision (a) of this section, provided, however, that:

(1) The notice shall include a statement of the factual bases for issuance of the order under this subdivision.

(2) The notice shall be delivered to the advisory organization’s offices within one day of issuance.

(3) The advisory organization shall be granted a hearing upon 10 days’ written request to the commissioner or upon the hearing date set by the commissioner, whichever is earlier.

(4) Within 10 days following the hearing under this subdivision, the commissioner shall confirm, modify, or withdraw the summary order issued prior to hearing under this subdivision.


text:
If, after a hearing pursuant to subdivision (d) of Section 1780.58 or subdivision (a) of Section 1780.60, the commissioner finds:

(a) That the advisory organization has violated or failed to comply with any provision of this chapter, the commissioner may issue an order to the advisory organization, specifying in what respect the violation or noncompliance exists and stating when, within a reasonable period of time, the violation or noncompliance shall cease.

(b) That the advisory organization has failed to comply with a final order of the commissioner under subdivision (a) within the time prescribed by the commissioner’s order or by any extension thereof which the commissioner may grant, the commissioner may issue an order suspending or revoking all or part of the advisory organization’s authorization to perform the duties delegated by the commissioner under this chapter, in addition to imposing any other penalty provided for in this chapter.

(c) That the advisory organization has willfully engaged in any fraudulent or dishonest act or practice, the commissioner may issue an order suspending or revoking all or part of the advisory organization’s authorization to perform the duties delegated by the commissioner under this chapter, in addition to imposing any other penalty provided for in this code.


text: Except as otherwise provided in this chapter, the proceedings required or authorized by subdivision (d) of Section 1780.58 and by Sections 1780.60 and 1780.61 shall be conducted in accordance with the provisions of Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code, and the commissioner shall have all the powers granted therein. Hearings shall be conducted by administrative law judges chosen under Section 11502 of the Government Code or appointed by the commissioner.


text:
(a) Any finding, determination, rule, ruling, or order made by the commissioner under this chapter shall be subject to review by the courts of this state, and proceedings on review shall be conducted in accordance with the provisions of the Code of Civil Procedure. In proceedings on review, the court shall apply the substantial evidence standard set forth in subdivision (c) of Section 1094.5 of the Code of Civil Procedure.

(b) Notwithstanding any other provision of law to the contrary, a petition for judicial review of any finding, determination, rule, ruling, or order of the commissioner may be filed within 30 days after the effective date thereof. Upon application by the advisory organization, a court may for good cause stay or enjoin the effect of any finding, determination, rule, ruling, or order of the commissioner issued pursuant to this chapter.

(c) The advisory organization shall have legal standing to bring and defend actions, in the name of the advisory organization, in administrative and judicial proceedings, with all powers attendant thereto.


text:
(a) If the surplus line advisory organization, or any of its officers, committee members, agents, or employees, fails to comply with a final order of the commissioner under this chapter, the advisory organization or the person shall be liable to the state in an amount not exceeding one hundred dollars ($100), but if the failure is willful, the advisory organization or the person shall be liable to the state in an amount not exceeding five thousand dollars ($5,000) for the failure. The commissioner shall collect the amount so payable and may bring an action in the name of the people of the State of California to enforce collection. These penalties may be in addition to any other penalties provided by law.

(b) A willful violation of any provision of this chapter by any person is a misdemeanor.


text: Any action by the surplus line advisory organization may be reviewed by the commissioner upon petition by any person adversely affected thereby, but only after all applicable remedies available under the advisory organization’s constitution, articles, and bylaws, if any, have been exhausted.


text:
(a) There shall be no liability on the part of, and no cause of action of any nature shall arise against, the surplus line advisory organization, or its members, officers, committee members, agents, or employees, or the Department of Insurance, the commissioner, or employees or representatives of the Department of Insurance, for any action taken or omitted by any of them in the performance of their duties or the exercise of their authority under this chapter, unless it can be shown that any of the parties specified in this subdivision acted in bad faith. The performance of any duty to the advisory organization delegated by the commissioner under this chapter or the exercise of any authority incidental thereto is an official duty of the advisory organization. Nothing in this subdivision shall be deemed or construed to grant any immunity, or any defense to liability, to a surplus line broker for that broker’s failure to comply with the surplus line law or the regulations pertaining thereto.

(b) The advisory organization’s communications with the commissioner and other appropriate authorities pursuant to its performance of the duties delegated by the commissioner under this chapter or its exercise of the authority incidental thereto shall be considered communications by an interested person to another interested person under the provisions of subdivision (c) of Section 47 of the Civil Code and shall be deemed confidential communications as defined in Section 12919.

(c) The immunities and privileges afforded by this section shall not affect the availability of any other immunities or privileges afforded by law and shall not affect any of the rights of hearing and review under, or any other provisions of, this chapter.


text:
(a) No person shall serve on the governing body of the surplus line advisory organization if in the past 10 years that person has been disciplined for violating the insurance laws or regulations of this state. The commissioner may waive this provision if the prior violation is not material to the person’s fitness to serve.

(b) At least 30 days prior to the election of its governing body, the advisory organization shall advise the commissioner of the names of the persons nominated for election to the governing body. If, prior to the election, the commissioner objects on reasonable grounds to the fitness to serve of any nominee or nominees, the nominee or nominees shall not qualify for that election.

(c) The advisory organization shall select and determine the terms of employment of its employees. The name and qualifications of any candidate for the permanent full-time position of executive director, manager, or chief operating officer of the advisory organization shall be submitted for the commissioner’s review. If, within 30 days after the submission of the candidate’s name and qualifications to the commissioner, the commissioner disapproves on reasonable grounds that candidate’s fitness to serve, the candidate shall not serve as the executive director, manager, or chief operating officer of the advisory organization.


text: This chapter shall be known and may be cited as the Reinsurance Intermediary Act.

history: (History: Added by Stats. 1991, Ch. 1009, Sec. 1.)

chapter: 6.5. Reinsurance Intermediaries

path: 1. GENERAL RULES GOVERNING INSURANCE > 2. THE BUSINESS OF INSURANCE > 6.5. Reinsurance Intermediaries


text:
As used in this chapter:

(a) “Actuary” means a person who is a member in good standing of the American Academy of Actuaries, the Casualty Actuarial Society, or the Society of Actuaries, and is qualified to sign statements of actuarial opinion on loss reserves.

(b) “Controlling person” means any person, firm, association, or corporation who directly or indirectly has the power to direct or cause to be directed, the management, control, or activities of a reinsurance intermediary.

(c) “Insurer” means any person, firm, association, or corporation admitted by the commissioner as an insurer in this state.

(d) “Licensed producer” means a licensed insurance agent, broker, or reinsurance intermediary.

(e) “Qualified United States financial institution” means an institution that meets all of the following criteria:

(1) Is organized or (in the case of a domestic office of a foreign banking organization) licensed, under the laws of the United States or any state thereof.

(2) Is regulated, supervised, and examined by federal or state authorities having regulatory authority over banks and trust companies.

(3) Has been determined by either the commissioner or the Securities Valuation Office of the National Association of Insurance Commissioners, to meet standards of financial condition and standing as are considered necessary and appropriate to regulate the quality of financial institutions whose letters of credit will be acceptable to the commissioner.

(f) “Reinsurance intermediary” means a reinsurance intermediary-broker or a reinsurance intermediary-manager.

(g) “Reinsurance intermediary-broker” means any person, other than an officer or employee of the ceding insurer, firm, association, or corporation that solicits, negotiates, or places reinsurance cessions or retrocessions on behalf of a ceding insurer without the authority or power to bind reinsurance on behalf of that insurer.

(h) “Reinsurance intermediary-manager” means any person, firm, association, or corporation that has authority to bind, or manages all or part of the assumed reinsurance business of, a reinsurer (including the management of a separate division, department, or underwriting office) and acts as an agent for the reinsurer whether known as a reinsurance intermediary-manager, manager, or other similar term. However, “reinsurance intermediary-manager” does not include any of the following:

(1) An employee of the reinsurer.

(2) A domestic manager of a United States branch of an alien reinsurer.

(3) An underwriting manager that, pursuant to contract, manages all or any portion of the reinsurance operations of the reinsurer, that is under common control with the reinsurer, that is subject to Article 4.7 (commencing with Section 1215) of Chapter 2, and the compensation of which is not based on the volume of premiums written.

(4) The manager of a group, association, pool, or organization of insurers which engage in joint underwriting or joint reinsurance and that are subject to examination by the insurance regulatory agency or official of the state in which the manager’s principal business office is located.

(i) “Reinsurer” means any person, firm, association, or corporation admitted in this state as an insurer with the authority to assume reinsurance.

(j) “Violation” means the failure of a reinsurance intermediary, or an insurer or reinsurer for whom the reinsurance intermediary was acting, to comply with any provision of this chapter.


text:
(a) No person, firm, association, or corporation shall act as a reinsurance intermediary-broker in this state unless licensed as follows:

(1) If the reinsurance intermediary-broker maintains an office, (either directly or as a member or employee of a firm or association, or an officer, director, or employee of a corporation) in this state, the reinsurance intermediary-broker shall be a licensed producer in this state.

(2) If the reinsurance intermediary-broker does not maintain an office in this state, the reinsurance intermediary-broker shall be a licensed producer in this state or another state having a law substantially similar to this chapter or shall be licensed in this state as a nonresident reinsurance intermediary.

(3) Unless denied licensure pursuant to subdivision (e), a nonresident person shall receive a reinsurance intermediary-broker license if all of the following requirements are met:

(A) The person is currently licensed and in good standing in the state, territory of the United States, or province of Canada where he or she is licensed as a resident reinsurance intermediary-broker.

(B) The person has submitted the proper request for licensure and has paid the fees required by paragraph (3) of subdivision (d).

(C) The person has submitted or transmitted to the commissioner the application for licensure that the person submitted to the state, territory of the United States, or province of Canada where he or she is licensed as a resident, or submitted or transmitted to the commissioner a completed National Association of Insurance Commissioners Uniform Nonresident Application.

(D) The state, territory of the United States, or province of Canada where the person holds a resident reinsurance intermediary-broker license awards nonresident reinsurance intermediary-broker licenses to residents of this state on the same basis.

(b) A person, firm, association, or corporation shall not act as a reinsurance intermediary-manager:

(1) For a reinsurer domiciled in this state, unless the reinsurance intermediary-manager is a licensed producer in this state.

(2) In this state, if the reinsurance intermediary-manager maintains an office either directly or as a member or employee of a firm or association, or as an officer, director, or employee of a corporation in this state, unless the reinsurance intermediary-manager is a licensed producer in this state.

(3) In another state for a nondomestic admitted insurer, unless the reinsurance intermediary-manager is a licensed producer in this state or in another state having a law substantially similar to this chapter or the person is licensed in this state as a nonresident reinsurance intermediary.

(4) Unless denied licensure pursuant to subdivision (e), a nonresident person shall receive a reinsurance intermediary-manager license if all of the following requirements are met:

(A) The person is currently licensed and in good standing in the state, territory of the United States, or province of Canada where he or she is licensed as a resident reinsurance intermediary-manager.

(B) The person has submitted the proper request for licensure and has paid the fees required by paragraph (3) of subdivision (d).

(C) The person has submitted or transmitted to the commissioner the application for licensure that the person submitted to the state, territory of the United States, or province of Canada where he or she is licensed as a resident, or submitted or transmitted to the commissioner a completed National Association of Insurance Commissioners Uniform Nonresident Application.

(D) The state, territory of the United States, or province of Canada where the person holds a resident reinsurance intermediary-manager license awards nonresident reinsurance intermediary-manager licenses to residents of this state on the same basis.

(c) The commissioner may require a reinsurance intermediary-manager subject to subdivision (b) to do both of the following:

(1) File a fidelity bond issued by an admitted surety in an amount determined by the commissioner for the protection of the reinsurer.

(2) Maintain an errors and omissions policy in an amount acceptable to the commissioner.

(d) (1) The commissioner may issue a reinsurance intermediary license to any person, firm, association, or corporation that has complied with the applicable requirements of this chapter. This license, when issued to a firm or association, authorizes all the members of the firm or association and any designated employees to act as reinsurance intermediaries under the license, and all these persons shall be named in the application and any supplements thereto. This license, when issued to a corporation, authorizes all of the officers, and any designated employees and directors thereof to act as reinsurance intermediaries on behalf of the corporation, and all these persons shall be named in the application and any supplements thereto.

(2) Any application for licensure as a reinsurance intermediary under this subdivision shall be made on a form prescribed by the commissioner and shall be accompanied by an application fee of three hundred seventy-four dollars ($374).

(e) The commissioner may refuse to issue a reinsurance intermediary license if, in his or her judgment, the applicant, any person named on the application, or any member, principal, officer, or director of the applicant, is determined by the commissioner not to be trustworthy, or that any controlling person of the applicant is not trustworthy to act as a reinsurance intermediary, or that any of the foregoing has given cause for revocation or suspension of a reinsurance intermediary license, or has failed to comply with any prerequisite for the issuance of a license. Upon written request therefor, the commissioner shall furnish the applicant with a summary of the basis for refusal to issue a reinsurance intermediary license, which document shall not be subject to inspection as a public record.

(f) Licensed attorneys at law when acting in their professional capacity as such shall be exempt from this section.

(g) A reinsurance intermediary-manager, when acting in that capacity and in compliance with this chapter, shall not be required to separately comply with Article 5.4 (commencing with Section 769.80) of Chapter 1 (if added by Senate Bill 1039 of the 1991–92 Regular Session) in order to engage in conduct authorized by both this chapter and that article.

history: (History: Amended by Stats. 2017, Ch. 534, Sec. 48. (AB 1699) Effective January 1, 2018.)


text:
Transactions between a reinsurance intermediary-broker and the insurer it represents in that capacity shall only be entered into pursuant to a written authorization specifying the responsibilities of each party. The authorization shall, at a minimum, contain provisions specifying all of the following rights and obligations:

(a) The insurer may terminate the reinsurance intermediary-broker’s authority at any time.

(b) The reinsurance intermediary-broker shall render accounts to the insurer accurately detailing all material transactions, including information necessary to support all commissions, charges, and other fees received by, or owing to, the reinsurance intermediary-broker, and remit all funds due to the insurer within 30 days of receipt.

(c) All funds collected for the insurer’s account will be held by the reinsurance intermediary-broker in a fiduciary capacity in a bank which is a qualified United States financial institution.

(d) The reinsurance intermediary-broker will comply with Section 1781.5.

(e) The reinsurance intermediary-broker will comply with written standards established by the insurer for the cession or retrocession of all insured risks.

(f) The reinsurance intermediary-broker will disclose to the insurer any relationship with any reinsurer to which insured risk will be ceded or retroceded.


text:
(a) For at least 10 years after expiration of each contract of reinsurance transacted by a reinsurance intermediary-broker, the reinsurance intermediary-broker shall keep a complete record for each transaction, including all of the following:

(1) The type of contract, limits, underwriting restriction, classes or risks, and territory.

(2) The period of coverage, including effective and expiration dates, cancellation provisions, and the notice required for cancellation.

(3) Reporting and settlement requirements for balances.

(4) The rate used to compute the reinsurance premium.

(5) The names and addresses of assuming reinsurers.

(6) The rates of all reinsurance commissions, including the commissions on any retrocession, handled by the reinsurance intermediary-broker.

(7) Related correspondence and memoranda.

(8) Proof of placement.

(9) Details regarding retrocession handled by the reinsurance intermediary-brokers, including the identity of retrocessionaires and the percentage of each contract assumed or ceded.

(10) Financial records, including, but not limited to, premium and loss accounts.

(11) If the reinsurance intermediary-broker procures a reinsurance contract on behalf of an admitted ceding insurer directly from the assuming reinsurer, the record of the transaction shall include written evidence that the assuming reinsurer has agreed to assume the risk. If the reinsurance intermediary-broker procures a reinsurance contract on behalf of an admitted ceding insurer that is placed through a representative of the assuming reinsurer, other than an employee thereof, the record of the transaction shall include written evidence that the reinsurer has delegated binding authority to the representative.

(b) The insurer shall have access and the right to copy and audit all accounts and records maintained by the reinsurance intermediary-broker related to its business in a form usable by the insurer.


text:
(a) An insurer shall not engage the services of any person, firm, association, or corporation to act as a reinsurance intermediary-broker on its behalf unless the person is licensed as required by subdivision (a) of Section 1781.3.

(b) An insurer may not employ an individual who is employed by a reinsurance intermediary-broker with which it transacts business unless the reinsurance intermediary-broker is under common control with the insurer and subject to Article 4.7 (commencing with Section 1215) of Chapter 2.

(c) The insurer shall annually obtain a copy of statements of the financial condition of each reinsurance intermediary-broker with which it transacts business.


text:
Transactions between a reinsurance intermediary-manager and the reinsurer it represents in that capacity shall only be entered into pursuant to a written contract specifying the responsibilities of each party, which shall be approved by the reinsurers’s board of directors. Before a reinsurer assumes or cedes business through such a producer, a true copy of the approved contract shall be filed with the commissioner. The contract shall, at a minimum, contain provisions setting forth the following terms and conditions:

(a) The reinsurer may terminate the contract for cause upon written notice to the reinsurance intermediary-manager. The reinsurer may suspend the authority of the reinsurance intermediary-manager to assume or cede business during the pendency of any dispute regarding the cause for termination.

(b) The reinsurance intermediary-manager shall, not less than quarterly, render calendar-year-basis and underwriting-year-basis accounts to the reinsurer accurately detailing all material transactions, including information necessary to support all commissions, charges, and other fees received by, or owing to, the reinsurance intermediary-manager, and shall remit all funds due under the contract to the reinsurer on not less than a quarterly basis.

(c) All funds collected for the reinsurer’s account shall be held by the reinsurance intermediary-manager in a fiduciary capacity in a bank the accounts of which are insured by an agency or instrumentality of the United States. The reinsurance intermediary-manager may retain no more than three months’ estimated claims payment and allocated loss adjustment expenses. Unless the funds held for each reinsurer by the reinsurance intermediary-manager in the fiduciary account are reasonably and readily ascertainable from its books of account and records, and the bank’s books of account and records, the reinsurance intermediary-manager shall maintain a separate bank account for each reinsurer that it represents. Notwithstanding the foregoing, the reinsurance intermediary-manager shall maintain a separate bank account for each reinsurer that it represents that is in receivership or liquidation or that the commissioner determines to be in an impaired financial condition.

(d) For at least 10 years after expiration of each contract of reinsurance transacted by the reinsurance intermediary-manager, the reinsurance intermediary-manager shall keep a complete record for each transaction showing all of the following:

(1) The type of contract, limits, underwriting restrictions, classes or risks, and territory.

(2) The period of coverage, including effective and expiration dates, cancellation provisions and notice required for cancellation, and disposition of outstanding reserves on covered risks.

(3) The reporting and settlement requirements with respect to balances.

(4) The rate used to compute the reinsurance premium.

(5) The names and addresses of reinsurers.

(6) The rates of all reinsurance commissions, including the commissions on any retrocessions handled by the reinsurance intermediary-manager.

(7) Related correspondence and memoranda.

(8) Proof of placement.

(9) Details regarding retrocessions handled by the reinsurance intermediary-manager, as permitted by subdivision (d) of Section 1781.9, including the identity of retrocessionaires and the percentage of each contract assumed or ceded.

(10) Financial records, including, but not limited to, premium and loss accounts.

(11) If the reinsurance intermediary-manager places a reinsurance contract on behalf of a ceding insurer directly from the assuming reinsurer, written evidence that the assuming reinsurer has agreed to assume the risk. If the reinsurance intermediary-manager procures a reinsurance contract on behalf of an admitted ceding insurer that is placed through a representative of the assuming insurer, other than an employee thereof, written evidence that the reinsurer has delegated binding authority to the representative.

(e) The reinsurer shall have access and the right to copy all accounts and records maintained by the reinsurance intermediary-manager related to its business in a form usable by the reinsurer.

(f) The contract cannot be assigned in whole or in part by the reinsurance intermediary-manager.

(g) The reinsurance intermediary-manager shall comply with the written underwriting and rating standards established by the insurer for the acceptance, rejection, or cession of all risks.

(h) The contract shall set forth the rates, terms, and purposes of commissions, charges, and other fees that the reinsurance intermediary-manager may levy against the reinsurer.

(i) If the contract permits the reinsurance intermediary-manager to settle claims on behalf of the reinsurer, it shall contain all of the following provisions:

(1) All claims shall be reported to the reinsurer in a timely manner.

(2) A copy of the claim file shall be sent to the reinsurer at its request or as soon as it becomes known that any of the following applies to the claim:

(A) The claim has the potential to exceed the lesser of an amount determined by the commissioner or the limit set by the reinsurer.

(B) The claim involves a coverage dispute.

(C) The claim may exceed the reinsurance intermediary-manager’s claims settlement authority.

(D) The claim is open for more than six months, unless the reinsurer agrees in writing to waive this requirement, in which event the reinsurance intermediary-manager shall annually provide the reinsurer with an exhibit identifying and describing each open claim.

(3) All claim files shall be joint property of the reinsurer and the reinsurer intermediary-manager. However, upon an order of liquidation of the reinsurer, these files shall become the sole property of the reinsurer or its estate, except when the reinsurance intermediary-manager is also managing the claim files for other reinsurers. In that event, the reinsurance intermediary-manager shall simultaneously and immediately provide the liquidator with copies of all the claim files. With respect to claim files pertaining solely to a reinsurer in liquidation, the reinsurance intermediary-manager shall have reasonable access to and the right to copy the files on a timely basis.

(4) Any settlement authority granted to the reinsurance intermediary-manager may be terminated for cause upon the reinsurer’s written notice to the reinsurance intermediary-manager or upon the termination of the contract. The reinsurer may suspend the settlement authority during the pendency of the dispute regarding the cause of termination.

(j) If the contract provides for a sharing of interim profits by the reinsurance intermediary-manager, interim profits shall not be paid until one year after the end of each underwriting period for property business and five years after the end of each underwriting period for casualty business, or a later period set by the commissioner for specified lines of insurance, and not until the adequacy of reserves on remaining claims has been verified pursuant to subdivision (c) of Section 1781.9.

(k) The reinsurance intermediary-manager shall annually provide the reinsurer with a statement of its financial condition prepared by an independent certified accountant and annually shall provide the reinsurer with a certification from an independent certified public accountant that the reinsurance intermediary-manager’s allocations of premiums and losses to the reinsurer have been made on a timely and proper basis.

(l) The reinsurer shall periodically and at least semiannually conduct an onsite review of the underwriting and claims processing operations of the reinsurance intermediary-manager.

(m) The reinsurance intermediary-manager shall disclose to the reinsurer any relationship it has with any insurer prior to ceding or assuming any business with the insurer pursuant to the contract.

(n) Within the scope of its actual or apparent authority, the acts of the reinsurance intermediary-manager shall be deemed to be the acts of the reinsurer on whose behalf it is acting.

history: (History: Amended by Stats. 2006, Ch. 538, Sec. 458. Effective January 1, 2007.)


text:
The reinsurance intermediary-manager shall not do any of the following:

(a) Directly or indirectly receive any compensation for the placement of retrocessions on behalf of the reinsurer.

(b) Bind any retrocession which would increase the contractual limit made available to the reinsurance intermediary-manager by the reinsurer. However, the reinsurance intermediary-manager may bind retrocessions which reduce or limit the commitments made on behalf of the reinsurer by the reinsurance intermediary-manager. The reinsurance intermediary-manager shall promptly inform the reinsurer of the terms, conditions, and retrocessionaires of such a retrocession arranged for its account.

(c) Commit the reinsurer to participate in reinsurance syndicates.

(d) Appoint any producer without assuring that the producer is lawfully licensed to transact the type of reinsurance for which he or she is appointed.

(e) Without prior approval of the reinsurer, pay or commit the reinsurer to pay a claim, net of retrocessions, that exceeds the lesser of an amount specified by the reinsurer or 1 percent of the reinsurer’s policyholders’ surplus as of December 31 of the last complete calendar year.

(f) Collect any payment from a retrocessionaire or commit the reinsurer to any claim settlement with a retrocessionaire, without prior approval of the reinsurer. If prior approval is given, a report must be promptly forwarded to the reinsurer.

(g) Jointly employ an individual who is employed by the reinsurer, unless the reinsurance intermediary-manager is under common control with the reinsurer that is subject to Article 4.7 (commencing with Section 1215) of Chapter 2.

(h) Appoint a subreinsurance intermediary-manager.


text:
(a) A reinsurer shall not engage the services of any person, firm, association, or corporation to act as a reinsurance intermediary-manager on its behalf, unless the person is licensed as required by subdivision (b) of Section 1781.3.

(b) A reinsurer shall annually obtain a copy of statements of the financial condition of each reinsurance intermediary-manager which the reinsurer has engaged prepared by an independent certified accountant in a form acceptable to the commissioner.

(c) If a reinsurance intermediary-manager establishes loss reserves, the reinsurer shall annually obtain the opinion of an actuary attesting to the adequacy of loss reserves or losses incurred on the business produced by the reinsurance intermediary manager. This opinion shall be in addition to any other required loss reserve certification. For purposes of this section, a reinsurance intermediary-manager shall not be considered as establishing loss reserves when the reinsurance intermediary-manager only utilizes loss reserves which are the reinsurer’s share of loss reserves established by the ceding insurer, provided that the ceding insurer has obtained the opinion of an actuary attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the reinsurance intermediary-manager.

(d) Binding authority for participation in reinsurance syndicates shall rest with an officer of the reinsurer who shall not be affiliated with the reinsurance intermediary-manager.

(e) Within 30 days of termination of a contract with a reinsurance intermediary-manager, the reinsurer shall provide written notification of the termination to the commissioner.

(f) A reinsurer shall not appoint to its board of directors, any officer, director, employee, controlling shareholder, or subproducer of its reinsurance intermediary-manager. This subdivision shall not apply to relationships governed by Article 4.7 (commencing with Section 1215) of Chapter 2.


text:
(a) A reinsurance intermediary shall be subject to examination by the commissioner. The commissioner shall have access to all books, bank accounts, and records of each reinsurance intermediary in a form usable to the commissioner.

(b) A reinsurance intermediary-manager may be examined as if it were the reinsurer.

(c) All documents and information disclosed in connection with the examination of a reinsurance intermediary may be used by the commissioner and shall be given confidential treatment by the commissioner to the same extent as provided in Section 735.5 for documents and information disclosed in connection with the examination of an insurer.

(d) An examination shall be at the expense of the reinsurance intermediary. The commissioner may revoke the license of the reinsurance intermediary for a refusal to promptly pay the examination expense when due.

history: (History: Amended by Stats. 2006, Ch. 321, Sec. 4. Effective January 1, 2007.)


text:
(a) A reinsurance intermediary, insurer, or reinsurer found by the commissioner to be in violation of this chapter, after a hearing conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code by an administrative law judge either chosen under Section 11502 of the Government Code or appointed by the commissioner, shall be subject to all of the following:

(1) For each separate violation, a penalty in an amount not exceeding five thousand dollars ($5,000).

(2) Be subject to revocation or suspension of its license or certificate of authority.

(b) Nothing contained in this section shall affect the right of the commissioner to impose or issue any other penalties or orders authorized by law.

(c) Nothing contained in this chapter shall in any manner limit or restrict the rights of policyholders, claimants, creditors, or other third parties or confer any rights upon those persons or otherwise limit any other authority required or authorized to be exercised under this code by the commissioner.


text: The commissioner may adopt reasonable rules and regulations for the implementation and administration of this chapter.


text: No insurer or reinsurer may continue to utilize the services of a reinsurance intermediary on and after January 1, 1992, unless utilization is in compliance with this chapter.


text:
(a) A reinsurance intermediary shall comply with any order of a court of competent jurisdiction or a duly constituted arbitration panel requiring the production of nonprivileged documents by the reinsurance intermediary, or the testimony of an employee or other individual otherwise under control of the reinsurance intermediary with respect to any reinsurance transaction for which it acted as a reinsurance intermediary.

(b) Compliance with subdivision (a) shall be subject to the right of the reinsurance intermediary and the parties to the transaction to object to the court or arbitration panel concerning the nature or scope of the documents or testimony or the time within which it must comply with the order. Failure to comply with the order shall be deemed to be a material noncompliance with this chapter.

history: (History: Added by Stats. 2006, Ch. 321, Sec. 5. Effective January 1, 2007.)


citation: INS § 1800

text:
(a) An insurer shall not execute an undertaking of bail except by and through a person holding a bail license issued as provided in this chapter. A person shall not in this state solicit or negotiate in respect to execution or delivery of an undertaking of bail or bail bond by an insurer, or execute or deliver such an undertaking of bail or bail bond unless licensed as provided in this chapter, but if so licensed, such person may so solicit, negotiate, and effect such undertakings or bail bonds without holding or being named in any license specified in Chapter 5 of this part.

(b) (1) A person shall not perform in this state the activities of a bail fugitive recovery agent, as defined in paragraph (4) of subdivision (a) of Section 1299.01 of the Penal Code, or solicit or negotiate to perform the activities of a bail fugitive recovery agent, as defined in paragraph 4 of subdivision (a) of Section 1299.01 of the Penal Code, unless licensed pursuant to this chapter.

(2) Any person, persons, or entity, including licensed bail agents and surety insurers, that hire, contract, solicit, or appoint another person or persons to act as a bail fugitive recovery agent shall ensure that the hired person or persons are duly licensed by the department as a bail fugitive recovery agent under paragraph (4) of subdivision (a) of Section 1801.

(c) For purposes of this section, “solicit” shall include any written or printed presentation or advertising made by mail or other publication, or any oral presentation or advertising by means of telephone, radio, or television which implies that an individual is licensed under this chapter, and any activity in arranging for bail which results in remuneration to the individual conducting that activity.

history: (History: Amended by Stats. 2025, Ch. 558, Sec. 15. (AB 487) Effective January 1, 2026.)

chapter: 7. Bail Licenses

article: 1. Qualification and Licensing

path: 1. GENERAL RULES GOVERNING INSURANCE > 2. THE BUSINESS OF INSURANCE > 7. Bail Licenses > 1. Qualification and Licensing


text: As used in this chapter, the term “bail bond” includes any contract not executed by a surety insurer for or method of release of person arrested or confined on account of any actual or alleged violation of the provisions of any law of this or any other State or of any municipality in the State of California, including any release by means of cash or other property deposited in lieu of bail under the provisions of sections 1295 and 1298 of the Penal Code whereby the attendance in court when required by law and obedience to orders and judgment of any court by the person released is guaranteed.

history: (History: Added by Stats. 1939, Ch. 361.)

article: 1. Qualification and Licensing


text: This chapter shall not affect the negotiation through a licensed broker or agent for, nor the execution or delivery of an undertaking of bail, executed by an insurer for its insured under a policy of automobile insurance or of liability insurance upon the automobile of the insured, nor shall this chapter affect the negotiation for, or the execution or delivery of an undertaking of bail or bail bond which is authorized by Part 5, Division 2 of this code.

article: 1. Qualification and Licensing


text: This chapter shall not limit the power of any city or county to enact other and further regulations concerning, and not in conflict with, the provisions of this chapter.

history: (History: Amended by Stats. 1963, Ch. 1286.)

article: 1. Qualification and Licensing


text: Any individual person may execute or furnish a bail bond if no consideration is paid or allowed, directly or indirectly, by any person for the execution or furnishing thereof, provided such person does not in connection with such execution or furnishing violate Section 1800.75.

article: 1. Qualification and Licensing


text: The permits required by this chapter are in addition to any and all other permits or licenses required by law.

article: 1. Qualification and Licensing


text: No person shall advertise or hold himself out as engaging in the business of executing, delivering, or furnishing bail bonds or undertakings of bail whether or not for consideration without holding at the time thereof all proper licenses required by this chapter.

history: (History: Added by Stats. 1963, Ch. 1286.)

article: 1. Qualification and Licensing


citation: INS § 1801

text:
(a) Bail licenses are:

(1) Bail agents’ licenses.

(2) Bail permittees’ licenses.

(3) Bail solicitors’ licenses.

(4) Bail fugitive recovery agent licenses.

(b) This section shall become operative on July 1, 2023.

history: (History: Repealed (in Sec. 3) and added by Stats. 2022, Ch. 768, Sec. 4. (AB 2043) Effective January 1, 2023. Operative July 1, 2023, by its own provisions.)

article: 1. Qualification and Licensing


citation: INS § 1802

text:
(a) A bail agent’s license by its terms permits the licensee to solicit, negotiate, and effect undertakings of bail on behalf of any surety insurer while there is in effect an unrevoked notice of appointment of such insurer filed pursuant to Section 1802.1. Such license shall not be issued unless and until there is filed with the commissioner a bond having an admitted surety insurer as surety thereon in the penal sum of one thousand dollars ($1,000), conditioned upon the proper application and disposal of all moneys collected or received by the bail agent, the bail agent’s solicitors licensed pursuant to the bail agent’s appointment, and the bail agent’s employees, in favor of the people of the State of California.

(b) A bail fugitive recovery agent shall file all of the following with the commissioner:

(1) A bond having an admitted surety insurer as surety thereon in the penal sum of one thousand dollars ($1,000). The surety bond required by this section shall allow persons to recover for actionable injuries, loss, or damage resulting from the willful or wrongful acts or omissions of the licensee and protects this state, its agents, officers, and employees from judgments against the licensee, and is further conditioned upon the faithful and honest conduct of the licensee.

(2) (A) A policy of liability insurance that provides minimum limits of insurance of one million dollars ($1,000,000) for any one loss or occurrence due to either bodily injury or death, or property damage, or both.

(B) The commissioner shall delay the implementation of subparagraph (A) if there is either a reasonable lack of availability or affordability, or both, of liability insurance for bail fugitive recovery agents.

(c) Bail agents, bail permittees, and bail solicitors who apply for a bail fugitive recovery agent license are exempt from subdivision (b) if they have a current surety bond and liability insurance policy on file with the commissioner.

(d) This section shall become operative on July 1, 2023.

history: (History: Repealed (in Sec. 5) and added by Stats. 2022, Ch. 768, Sec. 6. (AB 2043) Effective January 1, 2023. Operative July 1, 2023, by its own provisions.)

article: 1. Qualification and Licensing


text:
(a) Every applicant for a license to act as a bail agent shall file with the commissioner a notice of appointment executed by a surety insurer or its authorized representative authorizing that applicant to execute undertakings of bail and to solicit and negotiate those undertakings on its behalf. Additional notices of appointment may be filed by other surety insurers, upon the payment for each additional notice of the fee specified in subdivision (a) of Section 1811, before the license is issued and thereafter, as long as the license remains in force. Each appointment shall, by its terms, continue in force until any of the following occur:

(1) Termination of the bail agent’s license.

(2) The end of the license term, if the fee provided in subdivision (f) of Section 1811 for filing a renewal application is not paid.

(3) The filing of a notice of termination by the insurer, its representative, or by the bail agent.

(b) Every applicant for a license to act as a bail fugitive recovery agent shall file with the commissioner a notice of appointment executed by a bail agent or surety insurer authorizing that applicant to act on behalf of, and pursuant to, the instructions of the appointing licenseholder. Additional notices of appointment may be filed by other bail agents or surety insurers upon the payment for each additional notice of the fee specified in subdivision (a) of Section 1811, before the license is issued and thereafter, as long as the license remains in force. Each appointment shall, by its terms, continue in force until any of the following occur:

(1) Termination of the bail fugitive recovery agent’s license.

(2) The end of the license term, if the fee provided in subdivision (f) of Section 1811 for filing a renewal application is not paid.

(3) The filing of a notice of termination by the bail agent, the surety insurer, or the bail fugitive recovery agent.

(c) Bail agents and bail permittees who apply for a bail fugitive recovery agent license are exempt from subdivision (b) if the bail agent or bail permittee has one or more surety appointments on file with the commissioner and the surety or sureties providing the appointments have authorized the bail agent or bail permittee to work under their authority as a bail fugitive recovery agent.

(d) This section shall become operative on July 1, 2023.

history: (History: Repealed (in Sec. 7) and added by Stats. 2022, Ch. 768, Sec. 8. (AB 2043) Effective January 1, 2023. Operative July 1, 2023, by its own provisions.)

article: 1. Qualification and Licensing


text: Any bail licensee who has purchased or succeeded to the bona fide business of another bail licensee shall be entitled to use a true or fictitious name used by his predecessor if the predecessor has conducted the business for a period of two consecutive years or more.

history: (History: Added by Stats. 1984, Ch. 1063, Sec. 1.)

article: 1. Qualification and Licensing


text:
(a) A bail fugitive recovery agent’s license, by its terms, permits the licensee to engage in the activities of a bail fugitive recovery agent as set forth in paragraph (4) of subdivision (a) of Section 1299.01 of the Penal Code.

(b) A bail fugitive recovery agent licensee shall comply with the Bail Fugitive Recovery Persons Act (commencing with Section 1299) of the Penal Code.

(c) Notwithstanding subdivision (b) of Section 1810, only natural persons may be licensed as bail fugitive recovery agents.

(d) A bail fugitive recovery agent shall disclose on their license application and renewal to the department whether they are also a bail agent, permittee, or solicitor, and shall carry identification cards issued by the commissioner pursuant to Section 2077.1 of Chapter 5 of Title 10 of the California Code of Regulations.

(e) All bail licensees shall not have been convicted of a felony unless the person is licensed pursuant to Section 1800.

history: (History: Amended by Stats. 2025, Ch. 558, Sec. 16. (AB 487) Effective January 1, 2026.)

article: 1. Qualification and Licensing


text:
A bail permittee’s license, by its terms, permits the licensee to solicit, negotiate, issue, and deliver bail bonds. The license shall not be issued unless and until there is filed with the commissioner

a bond having an admitted surety insurer as surety thereon in the penal sum of five thousand dollars ($5,000), conditioned upon the proper application and disposal of all moneys collected or received by the bail permittee, his or her solicitors licensed pursuant to his or her appointment, and his or her employees, in favor of the people of the State of California.

history: (History: Amended by Stats. 2006, Ch. 538, Sec. 459. Effective January 1, 2007.)

article: 1. Qualification and Licensing


text: The holder of a bail permittee’s license may, upon filing of proper documents specified in Section 1802.1, receive a bail agent’s license without procuring the additional bond specified in Section 1802.

history: (History: Amended by Stats. 1972, Ch. 618.)

article: 1. Qualification and Licensing


text: Any applicant may deposit with the commissioner, in lieu of a bond required by this chapter, securities of the kind and character set forth in sections 1170 to 1175, and 1179 to 1240, in a sum not less than the required amount of the penal sum of said bond. Such securities shall be held in trust by the commissioner for the fulfillment of the same terms and conditions as in the case of a bond required by section 1802.5.

article: 1. Qualification and Licensing


text:
The holder, or former holder of a bail license, who has deposited with the commissioner securities in lieu of a bond as provided by Section 1802.7, may at any time substitute therefor a bond complying with the requirements of Section 1802, 1802.5, or 1803, as the case may be. Such a bond must embrace all liability theretofore existing or which may thereafter be incurred for the fulfillment of which the securities have been held, whether reported or unreported.

The substitution of such a bond for securities shall be conditioned upon the approval of the commissioner. Upon receiving such approval and the filing of the bond, the applicant shall be permitted to withdraw the securities theretofore deposited on his behalf.

history: (History: Amended by Stats. 1959, Ch. 599.)

article: 1. Qualification and Licensing