text:
No insurer who provides professional liability insurance for physicians and surgeons or dentists shall increase the premium for such insurance, impose a surcharge with respect to such insurance, or otherwise require additional compensation for such insurance, or institute or increase a deductible amount payable by the insured, because a notice of intention to commence an action has been given pursuant to Section 364 of the Code of Civil Procedure, unless a complaint has been served on the physician and surgeon or dentist with respect to such action.

(b) For the purposes of this section, “professional liability insurance” means insurance against liability for damages caused by any act or omission of a physician and surgeon or dentist in rendering professional services within this state issued by any insurer, including, but not limited to, a joint underwriting association, cooperative corporation or reciprocal or interinsurance exchange.

history: (History: Added by Stats. 1979, Ch. 988.)


kind: section

code: INS

text:
(a) (1) An insurer shall not refuse to issue or renew, nor shall terminate, professional liability insurance for a health care provider in this state, solely based on any prohibited bases for discrimination set forth in subdivision (d).

(2) With respect to policies issued in this state and that provide professional liability coverage for damages arising from services offered or performed in multiple states, if a health care provider offers or performs the services described in paragraph (1) of subdivision (d) in a state where those services are unlawful, nothing in this section shall be construed to prohibit an insurer from terminating, or refusing to issue or renew, a health care provider’s professional liability coverage in that state where the unlawful services are offered or performed.

(b) An insurer shall not increase premium, impose a surcharge or other additional compensation or cost, or institute or increase a deductible amount or other cost sharing payable by an insured, solely based on any prohibited bases for discrimination set forth in subdivision (d). Nothing in this section shall be construed to supersede, modify, or otherwise affect in any way the provisions of Article 10 (commencing with Section 1861.01) of Chapter 9 of Part 2 of Division 1 and implementing regulations, as applicable.

(c) An insurer providing professional liability insurance for health care providers in this state shall not deny coverage for liability for damages arising from offering or performing abortion, contraception, gender-affirming health care, or care related to those health care services, if those services are within the scope of the insured’s license, the services are lawful in the state where they are offered or performed, and the policy would otherwise cover liability for such damages arising from performing or rendering other professional services within the insured’s scope of license.

(d) For purposes of this section, “prohibited bases for discrimination” include all of the following:

(1) A health care provider offers or performs abortion, contraception, gender-affirming health care, or care related to those health care services, that are lawful in this state, including, but not limited to, those that may be unlawful in another state.

(2) Another state’s laws create potential or actual liability for abortion, contraception, gender-affirming health care, or care related to those health care services offered or performed in this state.

(3) Legal or administrative action taken in another state against a health care provider concerning abortion, contraception, gender-affirming health care, or care related to those health care services, results or resulted in a judgment, conviction, or disciplinary action against the provider, if those health care services, as provided, are or would be lawful and consistent with the applicable standard of care in this state.

(e) This section applies to professional liability insurance marketed, offered, issued, amended, or renewed in this state for health care providers in this state.

(f) For purposes of this section, the following definitions shall apply:

(1) “Health care provider” means a person licensed under Division 2 (commencing with Section 500) of the Business and Professions Code to perform or render health care services in this state.

(2) “Offer or perform” means to offer, perform, provide, prescribe, dispense, furnish, or otherwise render health care items or services, as well as to aid or assist in the rendering of those items or services.

(3) “Professional liability insurance” means insurance against liability for damages caused by any act or omission of a person licensed to provide health care services in rendering professional services within this state issued by any insurer, including, but not limited to, a joint underwriting association, cooperative corporation, or reciprocal or interinsurance exchange.

history: (History: Added by Stats. 2023, Ch. 256, Sec. 1. (AB 571) Effective January 1, 2024.)

division: 2. CLASSES OF INSURANCE

chapter: 1. General Regulations

path: 2. CLASSES OF INSURANCE > 3. LIABILITY, WORKERS' COMPENSATION, AND COMMON CARRIER LIABILITY INSURANCE > 1. General Regulations > 2. Actions on Policies Containing Liability Provisions


text:
No insurer who provides professional liability insurance for persons licensed under the provisions of Part 1 (commencing with Section 10000) of Division 4 of the Business and Professions Code shall exclude from coverage under that policy liability arising from the breach of the duty of the licensee arising under Article 2 (commencing with Section 2079) of Chapter 3 of Title 6 of Part 4 of Division 3 of the Civil Code. Notwithstanding the foregoing, an insurer may exclude coverage against liability arising out of a dishonest, fraudulent, criminal, or malicious act, error, or omission committed by, at the direction of, or with the knowledge of the insured.

For the purposes of this section, “professional liability insurance” means insurance against liability for damages caused by any act or omission of a real estate licensee in rendering professional services in this state.

history: (History: Added by Stats. 1985, Ch. 223, Sec. 3.)

part: 3. LIABILITY, WORKERS' COMPENSATION, AND COMMON CARRIER LIABILITY INSURANCE

article: 2. Actions on Policies Containing Liability Provisions


text: Except as provided in Section 11591, no policy providing comprehensive personal liability insurance may be issued or renewed in this state on or after January 1, 1977, unless it contains a provision for coverage against liability for the payment of compensation, as defined in Section 3207 of the Labor Code, to any person defined as an employee by subdivision (d) of Section 3351 of the Labor Code. Any such policy in effect on or after January 1, 1977, whether or not actually containing such provisions, shall be construed as if such provisions were embodied therein. However, such coverage shall not apply if any other existing, valid and collectible, workers’ compensation insurance for such liability is applicable to the injury or death of such employee.

history: (History: Repealed and added by Stats. 1977, Ch. 17.)

path: 2. CLASSES OF INSURANCE > 3. LIABILITY, WORKERS' COMPENSATION, AND COMMON CARRIER LIABILITY INSURANCE > 1. General Regulations > 2.5. Personal Liability Insurance Providing Workers’ Compensation Coverage for Household Employees


text: The requirements of Section 11590 shall be inapplicable to any such policy of insurance or endorsement where the services of such employee are in connection with the trade, business, profession, or occupation, as such terms are defined in Sections 3355 and 3356 of the Labor Code, of the insured.

article: 2.5. Personal Liability Insurance Providing Workers’ Compensation Coverage for Household Employees


text: Notwithstanding the provisions of subdivision (f) of Section 1851, the rates, classifications, and rating systems for the workers’ compensation insurance covering those persons defined as employees by subdivision (d) of Section 3351 of the Labor Code, and the insurers issuing such insurance coverage, shall be subject to the provisions of Chapter 9 (commencing with Section 1850) of Part 2 of Division 1.


text: The premium charge for the coverage required by Section 11590 shall not be separately stated from that charged for other coverage under the policy in the insured’s copy of the following: premium notice, policy, endorsement or memorandum of insurance.

history: (History: Added by Stats. 1978, Ch. 765.)


text: An incorporated insurer issuing policies of liability, workers’ compensation, or common carrier liability insurance, shall be governed by the paid-in capital and surplus requirements of Sections 700.01 to 700.05, inclusive.

history: (History: Amended by Stats. 1981, Ch. 714, Sec. 275.)

path: 2. CLASSES OF INSURANCE > 3. LIABILITY, WORKERS' COMPENSATION, AND COMMON CARRIER LIABILITY INSURANCE > 1. General Regulations > 3. Capital Requirements of Reserve Basis Insurers


text: Except as restricted by its charter, such an incorporated insurer, having such a paid-in capital, may transact all three of such insurances.

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

article: 3. Capital Requirements of Reserve Basis Insurers


text: Any such insurer which on July 26, 1919, was authorized by its charter to transact liability insurance may transact workers’ compensation and common carrier liability insurance as though expressly permitted by its charter to do so.

history: (History: Amended by Stats. 1981, Ch. 714, Sec. 276.)


text:
(a) The commissioner, after a public hearing, shall approve or issue a reasonable plan for the equitable apportionment, among insurers admitted to transact liability insurance, of those applicants for automobile bodily injury and property damage liability insurance who are in good faith entitled to but are unable to procure that insurance through ordinary methods. The commissioner shall require the payment of one thousand four hundred ten dollars ($1,410), in advance, as a fee for the filing of amendments to the plan with the commissioner. The commissioner may approve or issue reasonable amendments to the plan that are approved by the plan’s advisory committee, if he or she first holds a public hearing to determine whether the amendments are in keeping with the intent and purpose of this section. All those insurers shall subscribe to the plan and its amendments and participate in the plan.

(b) Judicial review of a change to the plan, including rate revision proceedings, shall be in accordance with Section 1858.6.

(c) The adoption of the plan referenced in subdivision (a), and any amendments thereto, is not subject to the requirements of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code), unless written or oral comments submitted pursuant to subdivision (e) raise regulatory standards set forth in subdivisions (a), (b), (c), (d), (e), and (f) of Section 11349 of the Government Code.

(d) The commissioner shall provide notice of any hearing pursuant to subdivision (a) by doing all of the following at least 45 days prior to the hearing:

(1) Publishing the notice in the California Regulatory Notice Register.

(2) Mailing the notice to the parties on the department’s regulations mailing list.

(3) Posting the notice on the department’s public Internet Web site.

(e) Interested parties may present written or oral comments at the hearing, or may submit written comments to the contact person identified in the hearing notice by the date and time posted in the notice. Before adopting any amendments to the plan, the commissioner shall consider all comments received on or before the day of the hearing.

history: (History: Amended by Stats. 2017, Ch. 534, Sec. 69. (AB 1699) Effective January 1, 2018.)

article: 4. Assigned Risk Plans

path: 2. CLASSES OF INSURANCE > 3. LIABILITY, WORKERS' COMPENSATION, AND COMMON CARRIER LIABILITY INSURANCE > 1. General Regulations > 4. Assigned Risk Plans


text: In the event an insurer discontinues writing automobile liability insurance in this state but retains its license to write that business, it shall continue to pay plan assessments and receive plan assignments until its quota or quotas established by its writings prior to discontinuance of business has or have been filled. However, if the automobile liability business of an insurer discontinuing the writing of that business in this state has been transferred to or reinsured by another insurer, the latter shall receive and assume the plan assignments and plan assessments of the insurer discontinuing business, as established by its writings prior to the transfer or agreement of reinsurance, until its quota or quotas has or have been filled, unless another insurer is allowed to assume those obligations.

history: (History: Added by Stats. 2000, Ch. 175, Sec. 2. Effective January 1, 2001.)

article: 4. Assigned Risk Plans


text:
(a) An insurer that is no longer licensed to write automobile liability insurance in this state shall have its plan business treated in the same manner as its voluntary business and shall not receive new assignments.

(b) The runoff of existing plan business shall be conducted in an orderly manner with policies nonrenewed upon the next anniversary date.

(c) An insurer that elects to surrender its license or has its license to do business in this state revoked shall comply with the following requirements:

(1) If an insurer elects to leave this state by surrendering its license to write automobile insurance, it shall submit to the plan’s advisory committee as a condition precedent to the surrender of its license, a plan that disposes of the insurer’s quota of plan assignments established by its voluntary writings, and provides for the handling of its outstanding assigned risk policies, including payment of claims, by appropriate financial arrangements or reinsurance agreements. The plan’s advisory committee shall evaluate the plan that is submitted and shall advise the commissioner as to whether or not it recommends acceptance or rejection by the commissioner of the plan.

(2) In the event an insurer’s license to do business in this state is revoked by the commissioner, the insurer shall submit to the plan’s advisory committee a plan that disposes of the insurer’s quota of plan assignments established by its voluntary writings, and provides for the handling of its outstanding assigned risk policies, including payment of claims, by appropriate financial arrangements or reinsurance agreements. The plan’s advisory committee shall evaluate the plan that is submitted and shall advise the commissioner as to whether or not it recommends acceptance or rejection by the commissioner of the plan.

(d) If all insurers in a group are under the same ownership and management, or a group elects to be treated as a single insurer and an insurer in the same group is no longer licensed, that insurer shall comply with the provisions of this section.

history: (History: Amended by Stats. 2001, Ch. 159, Sec. 150. Effective January 1, 2002.)

article: 4. Assigned Risk Plans


text: Insurer groups under the same ownership may elect to be treated as one insurer for purposes of participating in the plan and receiving its assignments and assessments pursuant to this article.

history: (History: Added by Stats. 2000, Ch. 175, Sec. 4. Effective January 1, 2001.)

article: 4. Assigned Risk Plans


text:
(a) New plan assignments to a participating insurer may be suspended or a participating insurer may be relieved of its obligation to renew existing assigned risk policies at expiration when a valid order of suspension is issued by the commissioner and the suspension of assignments or policy renewals is approved by the commissioner. Prior to the approval of a suspension of assignments or policy renewals, the plan’s advisory committee shall advise the commissioner as to whether or not it recommends approval or denial of the suspension.

(b) If an insurer granted relief pursuant to subdivision (a) resumes writing business in this state, its quota shall reflect the plan assignments it would have received and the assigned risk renewal policies it would have issued during its period of suspension. The required assignment adjustment shall be spread over a period of three or more years, as determined by the commissioner. Prior to determining this assignment adjustment, the plan’s advisory committee shall advise the commissioner as to whether or not it recommends approval or denial of the adjustment.

(c) The adjustment of the insurer’s quota shall be a percentage of the insurer’s under-assignments as determined by the commissioner. Prior to determining this adjustment, the plans’s advisory committee shall advise the commissioner as to whether or not it recommends approval or denial of the adjustment. After the approved period of adjustment has expired, the insurer’s normal quota will resume unless the insurer shows good cause to and receives approval from the commissioner for extension of the adjustment period. Prior to this approval, the plan’s advisory committee shall advise the commissioner as to whether or not it recommends approval or denial of this extension.

history: (History: Added by Stats. 2000, Ch. 175, Sec. 5. Effective January 1, 2001.)

article: 4. Assigned Risk Plans


text:
(a) In the event proceedings have been initiated by the commissioner to have an insurer declared insolvent, and a receiver or liquidator has been appointed, the plan shall reimburse any insured of that insurer for the unearned premium on any assigned risk policy then in force, upon submission of satisfactory evidence from the insured that the policy was in force at the time of the declaration of insolvency and that the requisite premium had been paid.

(b) The amount expended by the plan to remit unearned premium to insureds shall be deemed a cost of administration of the plan and shall be apportioned as provided in the plan adopted and approved pursuant to this article. The plan shall be subrogated in the liquidation proceedings to the right of reimbursement of all insureds to whom unearned premium has been remitted. In the event that the insurer is subsequently found by the court not to be insolvent, the proceedings are dismissed, and the receiver or liquidator has been discharged, the insurer shall be assessed by the plan for the total amount expended by the plan for return of unearned premiums.

history: (History: Added by Stats. 2000, Ch. 175, Sec. 6. Effective January 1, 2001.)

article: 4. Assigned Risk Plans


text:
(a) A plan shall require the issuance of a policy affording coverage in the amount of fifteen thousand dollars ($15,000) for bodily injury to, or death of, each person as a result of any one accident and, subject to that limit as to one person, the amount of thirty thousand dollars ($30,000) for bodily injury to, or death of, all persons as a result of any one accident, and the amount of five thousand dollars ($5,000) for damage to property of others as a result of any one accident, or in those minimum amounts as are necessary to provide exemption from the security requirements of Section 16021 of the Vehicle Code or for which proof of ability to respond in damages or adequate protection against liability is otherwise required by law, but shall not require the issuance of a policy affording coverage in excess of those amounts.

(b) For a policy or bond issued or renewed on or after January 1, 2025, a plan shall require the issuance of a policy affording coverage in the amount of thirty thousand dollars ($30,000) for bodily injury to, or death of, each person as a result of any one accident and, subject to that limit as to one person, the amount of sixty thousand dollars ($60,000) for bodily injury to, or death of, all persons as a result of any one accident, and the amount of fifteen thousand dollars ($15,000) for damage to property of others as a result of any one accident, or in those minimum amounts as are necessary to provide exemption from the security requirements of Section 16021 of the Vehicle Code or for which proof of ability to respond in damages or adequate protection against liability is otherwise required by law, but shall not require the issuance of a policy affording coverage in excess of those amounts.

(c) For a policy or bond issued or renewed on or after January 1, 2035, a plan shall require the issuance of a policy affording coverage in the amount of fifty thousand dollars ($50,000) for bodily injury to, or death of, each person as a result of any one accident and, subject to that limit as to one person, the amount of one hundred thousand dollars ($100,000) for bodily injury to, or death of, all persons as a result of any one accident, and the amount of twenty-five thousand dollars ($25,000) for damage to property of others as a result of any one accident, or in those minimum amounts as are necessary to provide exemption from the security requirements of Section 16021 of the Vehicle Code or for which proof of ability to respond in damages or adequate protection against liability is otherwise required by law, but shall not require the issuance of a policy affording coverage in excess of those amounts.

history: (History: Amended by Stats. 2023, Ch. 204, Sec. 15. (AB 1140) Effective January 1, 2024.)

article: 4. Assigned Risk Plans


text:
The plan shall provide for effective dates for coverage consistent with all of the following:

(a) Except as provided in this section, in no event shall coverage be effective prior to the date and time of execution of the application forms. Postage meter or United States Postal Service postmarks shall not be recognized by the plan as establishing effective dates.

(b) (1) When the applicant requires that coverage be effective immediately, the effective date and time shall be established using an electronic effective date procedure established by the plan. The plan shall establish a future effective date using the electronic effective date procedure. The future effective date option shall be available upon request by an applicant. An applicant may request a future effective date of 45 days or less from the date of application completion.

(2) The manager of the plan shall ensure access at no cost to the user as part of the electronic effective date procedure. The manager shall maintain sufficient capacity to service, in a timely manner, applications received by means of the electronic effective date procedure.

(3) The electronic effective date procedure shall be available only to producers of record who are certified by the plan and shall include a procedure to prevent fraudulent applications.

(4) A producer of record shall have a duty to comply with the requirements of this section within 24 hours of the date and time the application is completed and executed.

(c) Coverage for vehicles shall become effective at the date and time the application is transmitted through the plan’s electronic effective date procedure if and only if all of the following requirements are met:

(1) The producer of record and the applicant certify under penalty of perjury on the application the date and time that the application forms were completed and executed.

(2) The producer of record uses the electronic effective date procedure adopted pursuant to subdivision (b).

(3) The application forms and required deposit are submitted to the plan manager no later than two working days following the date the application forms are completed and executed. The submission date is established in accordance with the procedure established by the plan.

(d) If the application is made without using the electronic effective date procedure or if there is not compliance with the provisions of subdivision (c), coverage shall be effective in accordance with an alternative procedure established by the plan, but not later than 12:01 a.m. on the date following receipt of the application in the plan office unless a later date is requested.

(e) If the applicant desires coverage on a date later than that which would otherwise be fixed pursuant to this section, the applicant shall indicate that date and the plan manager shall fix the effective date of coverage as of 12:01 a.m. on the desired date of coverage. However, no date shall be later than 45 days after the date of application.

(f) The effective date for coverage for an additional vehicle to be added to an in-force policy or for other coverage to be added to an in-force policy shall not be subject to the requirements of this section, but shall be governed by the terms of the policy and other applicable laws and regulations.

(g) In order to provide evidence of a requested effective date, the plan shall establish a procedure for the maintenance of appropriate records of all risks for which the producer of record has designated the time and date of coverage.

(h) Where the plan’s electronic effective date procedure is disrupted due to failure of transmission or receiving equipment due to fire, earthquake, explosion, civil unrest, or similar disaster or emergency, the producer of record may bind coverage up to one day prior to the time the application forms and required deposit are mailed to the plan manager, as established by the United States Postal Service postmark on the envelope in which the application was enclosed.

(i) Notwithstanding any other provision of this section, where the producer of record discovers a material error in an application, the producer of record shall be authorized to rescind coverage bound for a period up to 24 hours after the date and time established pursuant to the plan’s electronic effective date procedure.

(j) To ensure compliance with the electronic effective date procedure, application forms shall contain the following statement in 12-point boldface type:

IMPORTANT NOTICETHIS POLICY IS NOT EFFECTIVE UNTIL YOUR APPLICATION IS ELECTRONICALLY TRANSMITTED TO THE PLAN BY YOUR AGENT OR BROKER. THE FOLLOWING CONDITIONS MUST ALSO BE MET: (1) BOTH YOU AND YOUR AGENT OR BROKER MUST SIGN AND DATE A PROPERLY COMPLETED APPLICATION. (2) YOUR AGENT OR BROKER MUST TRANSMIT YOUR APPLICATION TO THE PLAN WITHIN TWO DAYS OF ITS COMPLETION. YOU MAY REQUEST THAT YOUR AGENT OR BROKER TRANSMIT THE DOCUMENTS IN YOUR PRESENCE TO ENSURE IMMEDIATE COVERAGE, PROVIDED THE ABOVE REQUIREMENTS ARE MET. IF THE ABOVE REQUIREMENTS ARE NOT MET, THE EFFECTIVE DATE OF YOUR COVERAGE MAY BE DELAYED.

history: (History: Amended by Stats. 2010, Ch. 234, Sec. 2. (AB 1597) Effective January 1, 2011.)

article: 4. Assigned Risk Plans


text:
(a) (1) To assist the commissioner in carrying out the purposes of this article, an advisory committee composed of 15 members is created. The commissioner shall administer and operate the plan as authorized by law. The commissioner shall consult with the advisory committee on a regular basis on policy matters affecting the operation of the plan.

(2) Eight members representing subscribing insurers shall be elected annually by subscribing insurers. The commissioner shall appoint the noninsurer members. Four members shall represent the public. Two members shall represent producers. The remaining member is the commissioner or his or her designee.

(3) Each insurer representative serving shall be either (A) a salaried employee or officer of the named insurer or (B) a salaried employee or officer of another insurer from a group of insurance companies under the same management as the named insurer. A salaried employee or officer of the holding company of the named insurer may also be designated as the representative. At least two insurer representatives shall be employed by insurers having their principal headquarters located in California. At least two insurer representatives shall represent companies who have average annual automobile liability premiums in California below one hundred million dollars ($100,000,000) in the prior three years. At least one insurer representative shall represent an insurer with average annual automobile liability premiums in California exceeding one hundred million dollars ($100,000,000) in the prior three years. At least one insurer representative shall represent an insurer with average annual automobile liability premiums in California exceeding seven hundred million dollars ($700,000,000) in the prior three years.

(4) Public members shall be paid two hundred fifty dollars ($250) per meeting and shall be reimbursed all reasonable expenses incurred.

(5) The commissioner shall remove members for nonattendance. Unless satisfactory excuse is made in writing to the commissioner in a timely manner, nonattendance shall mean the failure to appear at more than two regularly scheduled meetings in a 12-month period. Should the member who is removed represent a company or agency, another representative from the company or agency may not be appointed for a period of not less than two years.

(6) The advisory committee with the approval of the commissioner shall appoint a manager to carry out the purposes of this article, employ sufficient personnel to provide services necessary to the operation of the plan, and contract for the provision of statistical and actuarial services.

(7) The cost of the plan, including any personnel and contracting costs, shall be fairly apportioned among the subscribing insurers to whom assignments may be made. The costs associated shall be directly attributable to the management of the plan and directly related to its programs. In consultation with the advisory committee, the commissioner shall develop, issue, and adopt regulations to carry out the purposes of this article.

(b) Notwithstanding this act, which changes the status of the governing committee to that of an advisory committee, the committee shall have the right to retain counsel of its choice pursuant to a selection process adopted by the committee and the right and necessary standing to bring and defend actions in judicial and administrative proceedings related to the plan in the name of the plan, with all powers attendant thereto including the right to retain consultants, counsel, and expert witnesses of its choice.

history: (History: Amended by Stats. 2011, Ch. 411, Sec. 55. (AB 1416) Effective January 1, 2012.)

article: 4. Assigned Risk Plans


text:
(a) Groups of insurers not under common ownership or management may form a limited assignment distribution arrangement. Each arrangement shall have one servicing carrier that writes assigned risk business on behalf of the members of the arrangement in return for consideration from the other participating carriers for not writing the business.

(b) No insurer may act as a servicing carrier except with the continuing approval of the commissioner.

(c) Each servicing carrier shall have a surplus of at least ten million dollars ($10,000,000).

(d) Upon the approval of the commissioner of a servicing carrier under this section, the plan shall make all assignments that otherwise would be made to a participant to the servicing carrier for that participant.

(e) The commissioner shall impose a filing fee for the filing necessary to obtain approval pursuant to this section, which fee shall be limited to that sufficient to defray the costs of the department in connection with considering the application.

history: (History: Added by Stats. 1990, Ch. 509, Sec. 1.)

article: 4. Assigned Risk Plans


text:
The plan shall contain:

(a) Standards for determining eligibility of applicants for insurance, including a requirement of a certificate of eligibility as provided in Section 11624.08, and in establishing those standards the following may be taken into consideration in respect to the applicant or any other person who may reasonably be expected to operate the applicant’s automobile with his or her permission:

(1) His or her criminal conviction record.

(2) His or her record of suspension or revocation of a license to operate an automobile.

(3) His or her automobile accident records.

(4) His or her age and mental, physical and moral characteristics which pertain to his or her ability to safely and lawfully operate an automobile.

(5) The condition or use of the automobile.

(b) Procedures for making application for insurance, for apportionment of eligible applicants among the subscribing insurers and for appeal to the commissioner by persons who believe themselves aggrieved by the operation of the plan.

(c) A provision that the organization administering the plan shall notify the Department of Insurance regarding the name of each applicant for insurance who is rejected by the assigned risk plan and the statutory grounds for the rejection. The information contained in that notification shall be for the confidential use of the Department of Insurance.

(d) Rules and regulations governing the administration and operation of the plan.

(e) Provisions showing the basis upon which premium charges shall be made, and the manner of payment thereof. Premium charges for the plan shall not be excessive, inadequate, nor unfairly discriminatory, and shall be actuarially sound so as to result in no subsidy of the plan. In no event shall the commissioner be required to approve a plan rate that includes a provision for operating profits greater than zero dollars. The commissioner shall not be required to allow a contingency provision with respect to a plan rate if the commissioner takes final action on an application for a rate change within 180 days from the date the application is submitted to the commissioner by the plan’s advisory committee. The plan shall include procedures for notifying within a reasonable time the agent, broker, or solicitor who obtained insurance under the plan for the insured of any nonpayment of premium to the insurer when notice of the nonpayment is sent to the insured pursuant to Section 662.

(f) Any other provisions as may be necessary to carry out the purpose of this article.

history: (History: Amended by Stats. 1993, Ch. 1133, Sec. 1. Effective January 1, 1994.)

article: 4. Assigned Risk Plans


text:
(a) An insurer shall mail a policy within 30 days of the receipt of an assignment.

(b) Upon the determination of an insurer to whom an assignment is made that the application of an insured is defective, the insurer shall immediately give written notice of the defect to the insured and to the agent or broker of record that the insured has 15 days from the mailing of the notice of defect to correct the defect.

history: (History: Added by Stats. 1990, Ch. 509, Sec. 2.)

article: 4. Assigned Risk Plans


text:
(a) An insurer shall acknowledge in writing within 15 days the receipt of a request for the endorsement of an assigned risk policy. The mailing of the endorsement within 15 days of receipt shall constitute acknowledgement of receipt.

(b) Upon receipt of a completed request for an endorsement that contains all information necessary for the issuance of an endorsement, the insurer shall issue and mail the endorsement to the insured within 30 days of the request for the endorsement.

(c) As used in this section, “endorsement” means an amendment of a policy, such as a loss payee endorsement, the addition or deletion of insureds, or the addition or deletion of coverage.

history: (History: Added by Stats. 1990, Ch. 509, Sec. 3.)

article: 4. Assigned Risk Plans


text: Any return premium checks due to an insured or to a lender subject to the provisions of subdivision (g) of Section 673 on account of a cancellation or endorsement shall be mailed within 30 days of the effective date of the cancellation or endorsement.

history: (History: Added by Stats. 1990, Ch. 509, Sec. 4.)

article: 4. Assigned Risk Plans


text:
Every insurer to whom an assignment is made shall do all of the following:

(a) Provide policyholders with information on how to report claims.

(b) Provide brokers and agents with a toll-free telephone number or accept their collect calls for the purpose of providing agents and brokers with a means of communicating with the insurer in order to rectify errors in applications or endorsements for assigned-risk coverage.

(c) Reply in writing within 15 days to complaints disputing the amount of premium charged for coverage under this article.

history: (History: Added by Stats. 1990, Ch. 509, Sec. 5.)

article: 4. Assigned Risk Plans


text: No insurance agent, broker or solicitor shall make any charge to the applicant, directly or indirectly, for furnishing any person the necessary application forms, technical assistance and services necessary to perfect an application through the plan other than such commission as is paid by the insurer pursuant to the provisions of such plan.

history: (History: Added by Stats. 1959, Ch. 213.)

article: 4. Assigned Risk Plans


text: Every insurer, agent, or broker assigned an application by the plan may conclusively rely on the acceptance, rejection, or waiver of coverages stated in the application signed by the applicant. A policy shall only be issued for the coverages, limits, and deductibles stated in the application assigned by the plan. This section shall apply to all applications assigned by the plan which are submitted to the plan by a person licensed pursuant to Chapter 5 (commencing with Section 1621) of Part 2 of Division 1.

history: (History: Repealed and added by Stats. 1988, Ch. 572, Sec. 2.)

article: 4. Assigned Risk Plans


text: Within 60 days after the effective date of any policy issued or renewed under this article, the insurer shall obtain from the Department of Motor Vehicles, or from a subscribing loss underwriting exchange carrier, a report on the applicant and any other person who may reasonably be expected to operate the applicant’s motor vehicle with the permission of the applicant. Any premium adjustments that occur as a result of the inspection of the reports shall be billed within the same 60-day period. This section does not apply to amendments of a policy other than upon original issuance or renewal.

history: (History: Amended by Stats. 2008, Ch. 42, Sec. 1. Effective January 1, 2009.)

article: 4. Assigned Risk Plans


text:
The plan shall require a certificate of eligibility to accompany the application for coverage. The certificate shall indicate whether or not the applicant meets the criteria for the purchase of a good driver discount policy as set forth in Section 1861.025 and, if so, the name of the insurer and the insurer’s representative that denied the applicant automobile insurance coverage.

The fact that an applicant has specified in the certificate of eligibility a particular insurer as having denied automobile insurance coverage shall not, by itself, be sufficient to sustain a finding in a formal action brought by the commissioner under Section 1858.1 that the specified insurer in fact denied the applicant automobile insurance coverage in violation of paragraph (1) of subdivision (b) of Section 1861.02. The certificate shall be signed by the applicant under penalty of perjury to verify its accuracy, and shall only be required with applications for personal lines automobile insurance through the plan. The agent or broker shall also be required to sign the certificate of eligibility indicating that he or she has reviewed the certificate for completeness.

history: (History: Amended by Stats. 1993, Ch. 1135, Sec. 1. Effective January 1, 1994.)

article: 4. Assigned Risk Plans


text:
Upon a determination by the plan that a certificate of eligibility is defective due to an omission or mistake which is immaterial to determining the eligibility of the applicant for coverage, the plan shall immediately provide written notice of the defect or defects to the insured and to the agent or broker of record. The notice shall inform the applicant that he or she has 10 days from the postmark date of the notice to correct the defect and postmark the correction or missing information for return to the plan.

In the event that the defect is not corrected within that 10-day time period, the policy is void from inception. Providing a photocopy of the application or certificate denoting the specific defect or defects shall be adequate to comply with the requirement to specify the defects in the certificate.

For purposes of this section, failure to provide a required telephone number, time of day, producer number, producer signature, date or information that is omitted but can be determined by questions answered or information provided in other sections of the application or documents submitted as part of the application, shall be considered an omission or mistake immaterial to determining the eligibility of the applicant for the plan coverage. A certificate of eligibility that is submitted to the plan as to which the applicant did not demonstrate a good faith effort in completing or where the applicant has made a willful misrepresentation shall not be subject to this section. In the event that the defect is material to determining the eligibility of the applicant for coverage, the policy is void from inception.

history: (History: Amended by Stats. 1992, Ch. 1255, Sec. 4. Effective January 1, 1993.)

article: 4. Assigned Risk Plans


text: If an insurer admitted to transact liability insurance fails to subscribe to the plan or to any amendments thereto, the commissioner shall give 10 days’ written notice to such insurer to so subscribe. If such insurer fails to comply with such notice, then the commissioner may, after hearing upon notice, suspend the certificate of authority of such insurer to transact liability insurance in this State until such insurer does so subscribe. Proceedings under this section shall be conducted in accordance with Chapter 5, Part 1, Division 3, Title 2 of the Government Code, and the commissioner shall have all the powers granted therein.

history: (History: Added by Stats. 1947, Ch. 1205.)

article: 4. Assigned Risk Plans


text: If the commissioner, after hearing upon not less than ten (10) days’ notice, finds that any insurer has failed to perform any of the duties required of it by this article or by the plan, other than those duties enumerated in Section 11625, he may issue an order to such insurer specifying in what manner and to what extent he finds the insurer to have so failed and requiring, within a reasonable time, not less than 10 days, compliance with such requirements. If within the period specified in the order the insurer fails to comply with such order, such insurer shall, in addition to any other penalty provided by law, forfeit to the State a penalty of five hundred dollars ($500) for each such failure. The commissioner may bring an action in his own name against the insurer to collect the said penalty.

article: 4. Assigned Risk Plans


text:
(a) No insurer shall downgrade the rating, or otherwise adversely affect the insurability, of a person insured under Section 11622.1 solely because of that person’s participation in the assigned risk plan or because that person contracts with a person insured under Section 11622.1.

(b) An insurer violating subdivision (a) is subject to the penalties set forth in Section 11626, and shall restore the insurance rating, insurability, and coverage of any person harmed by the violation.

history: (History: Added by Stats. 1986, Ch. 155, Sec. 4. Effective June 16, 1986.)

article: 4. Assigned Risk Plans


text: In this article, “insurer” includes reciprocal or interinsurance exchanges.

article: 4. Assigned Risk Plans


text:
(a) (1) No admitted insurer that is licensed to issue and issuing motor vehicle liability policies, as defined in Section 16450 of the Vehicle Code, shall fail or refuse to accept an application for that insurance, to issue that insurance to an applicant therefor, or issue or cancel that insurance under conditions less favorable to the insured than in other comparable cases, except for reasons applicable alike to persons of every characteristic listed or defined in subdivision (b) or (e) of Section 51 of the Civil Code, including, but not limited to, language, or persons of the same geographic area; nor shall any characteristic listed or defined in subdivision (b) or (e) of Section 51 of the Civil Code, including, but not limited to, language, or location within a geographic area, of itself, constitute a condition or risk for which a higher rate, premium, or charge may be required of the insured for that insurance.

(2) As used in this section “geographic area” means a portion of this state of not less than 20 square miles defined by description in the rating manual of an insurer or in the rating manual of a rating bureau of which the insurer is a member or subscriber. In order that geographic areas used for rating purposes may reflect homogeneity of loss experience, a record of loss experience for the geographic area shall include the breakdown of actual loss experience statistics by ZIP Code area (as designated by the United States Postal Service) within each geographic area for family owned private passenger motor vehicles and lightweight commercial motor vehicles, under 112-ton load capacity, used for local service or retail delivery, normally within a 50-mile radius of garaging, and that are not part of a fleet of five or more motor vehicles under one ownership. A record of loss experience for the geographic area, including that statistical data by ZIP Code area, shall be submitted biennially to the commissioner for examination by each insurer licensed to issue and issuing motor vehicle liability policies, motor vehicle physical damage policies, or both. Loss experience shall include separate loss data for each type of coverage, including liability or physical damage coverage, underwritten. The biennial report shall include the insurer’s statewide loss ratio, loss adjustment expense ratio, expense ratio, and combined ratio on its assigned-risk business. Statewide summary data shall be submitted annually to the commissioner. An insurer may satisfy its obligation to report statistical data under this subdivision by providing its loss experience data and statewide expense ratio and combined ratio on its assigned-risk business to a rating or advisory organization for submission to the commissioner. This data shall be made available to the public by the commissioner biennially after examination. However, the data shall be released in aggregate form by ZIP Code or statewide basis in order that no individual insurer’s loss experience for any specific geographic area be revealed. Differentiation in rates between geographical areas shall not constitute unfair discrimination.

(3) All information reported to the department pursuant to this subdivision shall be confidential.

(4) As used in this section:

(A) “Language” means the inability to speak, read, write, or comprehend the English language.

(B) “Dependents” shall include, but not be limited to, issue regardless of generation.

(C) “Spouse” shall be determined without regard to current marital status.

(b) The commissioner may require insurers with combined ratios on statewide assigned-risk business that are 10 percent above the mean combined ratio for all plan participants to also report the following:

(1) The reason for the excessive ratio.

(2) A plan for reducing the ratio, and when the reduction can be expected to occur. The commissioner may require insurers subject to this subdivision to provide periodic reports on the progress in reducing the combined ratio.

(c) (1) No admitted insurer, licensed to issue and issuing motor vehicle liability insurance policies as defined in Section 16450 of the Vehicle Code, shall fail or refuse to accept an application for that insurance, refuse to issue that insurance to an applicant therefor, or cancel that insurance solely for the reason that the applicant for that insurance or any insured is employed in a specific occupation, or is on active duty service in the Armed Forces of the United States.

(2) Nothing in this section shall prohibit an insurer from doing any of the following:

(A) Considering the occupation of the applicant or insured as a condition or risk for which a higher rate or discounted rate may be required or offered for coverage in the course and scope of his or her occupation.

(B) Charging a deviated rate to any classification of risks involving a specific occupation, or grouping thereof, if the rate meets the requirements of Chapter 9 (commencing with Section 1850.4) of Part 2 of Division 1 and is based upon actuarial data that demonstrates a significant actual historical differential between past losses or expenses attributable to the specific occupation, or grouping thereof, and the past losses or expenses attributable to other classification of risks. For purposes of compiling that actuarial data for a specific occupation or grouping thereof, a person shall be deemed employed in the occupation in which that data is compiled if any of the following is true:

(i) The majority of his or her employment during the previous year was in the occupation.

(ii) The majority of his or her aggregate earnings for the immediate preceding three-year period were derived from the occupation.

(iii) The person is a member in good standing of a union that is an authorized collective bargaining agent for persons engaged in the occupation.

(3) Nothing in this section shall be construed to include in the definition of “occupation” any status or activity that does not result in remuneration for work done or services performed, or self-employment in a business operated out of an applicant’s or insured’s place of residence or persons engaged in the renting, leasing, selling, repossessing, rebuilding, wrecking, or salvaging of motor vehicles.

(d) Nothing in this section shall limit or restrict the ability of an insurer to refuse to accept an application for or refuse to issue or cancel insurance for the reason that it is a commercial vehicle or based upon the consideration of a vehicle’s size, weight, design, or intended use.

(e) It is the intent of the Legislature that actuarial data by occupation may be examined for credibility by the commissioner on the same basis as any other automobile insurance data that he or she is empowered to examine.

(f) (1) Except as provided in Article 4 (commencing with Section 11620), nothing in this section or in Article 10 (commencing with Section 1861.01) of Chapter 9 of Part 2 of Division 1 or in any other provision of this code, shall prohibit an insurer from limiting the issuance or renewal of insurance, as defined in subdivision (a) of Section 660, to persons who engage in, or have formerly engaged in, governmental or military service or segments of categories thereof, and their spouses, dependents, direct descendants, and former dependents or spouses.

(2) The term “military service” includes, but is not limited to, officers, warrant officers, and enlisted persons, officer and warrant officer candidates, cadets or midshipmen at a service academy, cadets or midshipmen in advance Reserve Officer Training Corps programs or on Reserve Officer Training Corps program scholarships, National Guard officer candidates, students in government-sponsored precommissioning programs, and foreign military officers while on temporary duty in the United States.

(g) Any person subject to regulation by the commissioner pursuant to this code who fails to comply with a data call required by the department pursuant to subdivision (a) shall be liable to the state for a civil penalty in an amount not exceeding five thousand dollars ($5,000) for each 30-day period that the person is not in compliance, unless the failure to comply is willful, in which case the civil penalty shall be in an amount not to exceed ten thousand dollars ($10,000) for each 30-day period that the person is not in compliance, but not to exceed an aggregate amount of one hundred thousand dollars ($100,000). 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 shall be in addition to other penalties provided by law.

(h) This section shall be known and may be cited as the “Rosenthal Auto Insurance Nondiscrimination Law.”

history: (History: Amended by Stats. 2014, Ch. 362, Sec. 6. (AB 2734) Effective January 1, 2015.)

article: 5. Motor Vehicle Liability Insurance

path: 2. CLASSES OF INSURANCE > 3. LIABILITY, WORKERS' COMPENSATION, AND COMMON CARRIER LIABILITY INSURANCE > 1. General Regulations > 5. Motor Vehicle Liability Insurance


text:
(a) Based on the actuarial and loss experience data available to each insurer, including the driving records of mature driver improvement course graduates, as recorded by the Department of Motor Vehicles, every admitted insurer shall provide for an appropriate percentage of reduction in premium rates for motor vehicle liability insurance for principal operators who are 55 years of age or older and who produce proof of successful completion of the mature driver improvement course provided for and approved by the Department of Motor Vehicles pursuant to Section 1675 of the Vehicle Code.

(b) The insured shall enroll in and successfully complete the course described in subdivision (a) once every three years in order to continue to be eligible for an appropriate percentage of reduced premium.

(c) The percentage of premium reduction required by subdivision (a) shall be reassessed by the insurer upon renewal of the insured’s policy. The insured’s eligibility for any percentage of premium reduction shall be effective for a three-year period from the date of successful completion of the course described in subdivision (a), except that the insurer may discontinue the reduced premium rate if the insured is in any case:

(1) Involved in an accident for which the insured is at fault, as determined by the insurer.

(2) Convicted of a violation of Division 11 (commencing with Section 21000) of the Vehicle Code, except Chapter 9 (commencing with Section 22500) of that division, or of a traffic related offense involving alcohol or narcotics.

(d) The percentage of premium rate reduction required by subdivision (a) does not apply in the event the insured enrolls in, and successfully completes, an approved course pursuant to a court order provided for in Section 42005 of the Vehicle Code. Nothing in this subdivision precludes an insured from also enrolling in a driver improvement course.

history: (History: Added by Stats. 1986, Ch. 1325, Sec. 2. Operative July 1, 1987, by Sec. 8 of Ch. 1325.)

article: 5. Motor Vehicle Liability Insurance


text:
No admitted insurer, licensed to issue motor vehicle liability policies as defined in Section 16450 of the Vehicle Code, shall fail or refuse to accept an application from a handicapped person for such insurance, or to issue such insurance to a handicapped applicant therefor solely because of handicap, or to issue or cancel such insurance under conditions less favorable to handicapped persons than nonhandicapped persons; nor shall a handicap itself constitute a condition or risk for which a higher rate, premium, or charge may be required of a handicapped person for such insurance.

As used in this section, “handicapped person” and “handicapped applicant” refer only to persons who have suffered an impairment of physical ability because of amputation or loss of function which impairment has been compensated for, when necessary, by vehicle equipment adaptation or modification; or who have suffered an impairment of hearing which impairment has been compensated for, when necessary, either by sensory equipment adaptation or modification; or who have suffered an impairment of speech; provided, that the insurer may require a handicapped applicant for such insurance or the renewal of such insurance to furnish proof that he or she has qualified for a new or renewed drivers license through the California Department of Motor Vehicles since the occurrence of the handicapping condition.

If such insurer can justify a higher rate, premium, or charge for handicapped persons with actuarial evidence, a higher rate, premium, or charge may be required.

history: (History: Added by Stats. 1979, Ch. 524.)

article: 5. Motor Vehicle Liability Insurance


text:
No admitted insurer, licensed to issue motor vehicle liability policies as defined in Section 16450 of the Vehicle Code, shall fail or refuse to accept an application for that insurance, or to issue that insurance, on the basis that the owner of the motor vehicle to be insured is blind. However, notwithstanding any other provision of law, an admitted insurer may exclude from coverage under the policy the unlicensed owner of a motor vehicle who is blind for injuries and damages incurred while the insured vehicle is operated by an unlicensed owner who is blind.

Nothing in this section shall prohibit an insurer from applying its usual and customary underwriting and rating criteria with respect to the operators of the vehicle to be insured, including, but not limited to, the loss experience the insurer has had with respect to the insured vehicle.

No insurer shall raise the premiums of an insured blind person or shall cancel the policy of an insured blind person solely on the basis that the operators of the insured vehicle are changed frequently.

history: (History: Added by Stats. 1981, Ch. 330, Sec. 1.)

article: 5. Motor Vehicle Liability Insurance


text: Each separate act of an insurer or its agent in violation of Section 11628 or 11628.5 shall render the insurer liable in damages in the amount of one hundred dollars ($100), plus a reasonable allowance for attorneys’ fees incurred in connection with the prosecution of the action, which may be recovered in an action at law brought for that purpose by the person aggrieved by any such act.

history: (History: Amended by Stats. 1984, Ch. 193, Sec. 93.)

article: 5. Motor Vehicle Liability Insurance


text: Any insurer which has refused to issue to an applicant a policy of insurance in violation of Section 11628 or 11628.5 and which has been required to pay damages for the violation pursuant to Section 11629 shall pay as additional damages the amount by which the rates which the applicant found it necessary to pay to obtain other insurance exceed the rates of the insurer.

history: (History: Amended by Stats. 1984, Ch. 193, Sec. 94.)

article: 5. Motor Vehicle Liability Insurance


text:
(a) There is established, within the California Automobile Assigned Risk Plan established under Section 11620, a low-cost automobile insurance program for all counties in California.

(b) The commissioner, after a public hearing, shall approve or issue a reasonable plan for the equitable apportionment, among insurers required to participate in the California Automobile Assigned Risk Plan established under Section 11620, of persons who are eligible to purchase through the program a low-cost automobile insurance policy, as described in Section 11629.71. The program shall be conducted in conjunction with the California Automobile Assigned Risk Plan established under Section 11620.

history: (History: Amended by Stats. 2014, Ch. 487, Sec. 1. (SB 1273) Effective January 1, 2015.)

path: 2. CLASSES OF INSURANCE > 3. LIABILITY, WORKERS' COMPENSATION, AND COMMON CARRIER LIABILITY INSURANCE > 1. General Regulations > 5.5. California Low-Cost Automobile Insurance Program


text: Notwithstanding the coverage amounts required by Section 16056 of the Vehicle Code, a low-cost automobile policy issued under the program shall satisfy the financial responsibility requirements of Sections 4000.37, 16021, and 16431 of the Vehicle Code.

history: (History: Amended by Stats. 2005, Ch. 435, Sec. 13. Effective January 1, 2006.)

article: 5.5. California Low-Cost Automobile Insurance Program


text:
A low-cost automobile insurance policy for purposes of the program established under this article shall have all of the following attributes:

(a) The policy shall offer coverage in the amount of ten thousand dollars ($10,000) for bodily injury to, or death of, each person as a result of any one accident and, subject to that limit as to one person, the amount of twenty thousand dollars ($20,000) for bodily injury to, or death of all persons as a result of any one accident, and the amount of three thousand dollars ($3,000) for damage to property of others as a result of any one accident.

(b) The coverage required by Section 11580.2 shall be made available to the consumer. However, an insurer may charge a premium for that coverage in addition to the premium set forth in Section 11629.72. Notwithstanding the coverage amounts required by Section 11580.2 and Section 16056 of the Vehicle Code, uninsured motorist coverage issued in conjunction with a low-cost automobile policy under the program, with coverage limits at least equal to the limits of liability in the underlying low-cost automobile policy, shall satisfy the requirements of Section 11580.2 and the financial responsibility requirements of Sections 4000.37, 16021, and 16431 of the Vehicle Code.

(c) Medical payments coverage shall be made available to the consumer. However, an insurer may charge a premium for that coverage in addition to the premium set forth in Section 11629.72.

(d) The policy shall have an initial term of one year, renewable on an annual basis thereafter.

(e) The policy shall cover the person named in the policy, and to the same extent that insurance is provided to the named insured, any other person using the automobile, provided the use is with his or her permission, express or implied, and within the scope of that permission, except that the policy shall not cover members of the named insured’s household who do not satisfy the requirements of subdivisions (b) to (e), inclusive, of Section 11629.73.

(f) The policy shall provide coverage for an automobile with a value of twenty-five thousand dollars ($25,000) or less, as evidenced by the value given to the automobile by the Department of Motor Vehicles in assessing vehicle license fees, or another method of determining market value adopted by the California Automobile Assigned Risk Plan Advisory Committee (CAARP Advisory Committee) and approved by the commissioner.

history: (History: Amended by Stats. 2014, Ch. 487, Sec. 2. (SB 1273) Effective January 1, 2015.)


text:
(a) The annual rate offered under the program for each of the counties in California shall be established at a date according to the discretion of the commissioner. Surcharges, as a percentage of the base rate, shall be added to the base rate and that percentage shall be set at the discretion of the commissioner, if the named insured or a resident of the household of the named insured will be a driver of the automobile covered under the low-cost policy, and is a person 16 years of age or older to whom any of the following applies:

(1) Is an unmarried individual between 16 and 24 years of age.

(2) Operates a vehicle with a driver’s license issued by the Department of Motor Vehicles pursuant to Section 12801.9 of the Vehicle Code and has fewer than three years of driving history.

(3) Has fewer than three years of driving history.

(4) Has not been continually licensed to drive for the past three years.

(b) (1) The California Automobile Assigned Risk Plan shall make available to an insured under the program, subject to approval by the commissioner, a premium installment option pursuant to which an insured is required to pay not more than 20 percent of the total policy cost upon issuance of the low-cost policy, followed thereafter by seven other payments. The plan may make additional payment plans available, subject to approval by the commissioner.

(2) No other premium financing arrangement shall be permitted.

(c) Rates for policies issued under the program in each county or city and county shall be reviewed and revised as follows:

(1) Rates shall be sufficient to cover (A) losses incurred under policies issued under the program, and (B) expenses, including, but not limited to, all reasonable and necessary expenses such as the costs of administration, underwriting, taxes, commissions, and claims adjusting, that are incurred due to participation in the program. For purposes of this paragraph, “losses incurred” means claims paid, claims incurred and reported, and claims incurred but not yet reported. In assessing loss reserves, the commissioner shall only allow loss reserves that are estimated from actual losses in the program or comparable data by a licensed statistical agent, as adjusted to reflect coverage provided under the program.

(2) Rates shall be set so as to result in no projected subsidy of the program by those policyholders of insurers issuing policies under the program who are not participants in the program.

(3) Rates shall be set with respect to the program so as to result in no projected subsidy by policyholders in one county of policyholders in any of the other counties.

(4) (A) Commencing on January 1, 2015, and annually thereafter through January 1, 2017, the California Automobile Assigned Risk Plan shall submit the loss and expense data, together with a proposed rate and the surcharge authorized by subdivision (a) for the low-cost automobile policy for the program, to the commissioner for approval in accordance with this chapter. The commissioner shall act on the recommendation within 90 days.

(B) After the January 1, 2017, rate filing, subsequent rate filings are mandatory if the rate indication is a change of greater than 7 percent from the previous filing, or at the discretion of the CAARP Advisory Committee if the rate indication is a change of less than 7 percent.

history: (History: Amended by Stats. 2019, Ch. 274, Sec. 1. (SB 570) Effective January 1, 2020.)


text:
A low-cost automobile insurance policy under the program shall only be available for purchase by persons who satisfy the following eligibility requirements:

(a) The person shall be in a household with an annual gross household income that does not exceed 250 percent of the federal poverty level, as defined in Part 6.2 (commencing with Section 12693) or as defined in an equivalent manner that is approved by the commissioner.

(b) The person shall be no less than 16 years of age and have been continuously licensed to drive an automobile for the previous three years, except that a person who has not been continually licensed to drive or has fewer than three years of driving history may qualify for the surcharge under subdivision (a) of Section 11629.72.

(c) The person shall have not more than one of either, but not both, of the following within the previous three years:

(1) A property damage only accident in which the driver was principally at fault.

(2) A point for a moving violation.

(d) The person shall not have on record within the previous three years, an at-fault accident involving bodily injury or death.

(e) The person shall not have a felony or misdemeanor conviction for a violation of the Vehicle Code on the person’s motor vehicle record.

(f) The person shall not be a student claimed as a dependent of another person for federal or state income tax purposes, unless the student resides at the same address where the student is claimed as a dependent.

history: (History: Amended by Stats. 2019, Ch. 274, Sec. 2. (SB 570) Effective January 1, 2020.)


text:
(a) Application may be made through any producer certified by the plan. The applicant, in order to demonstrate financial eligibility to purchase a low-cost automobile insurance policy under the program, shall present at the time of applying for the policy documents deemed appropriate to confirm proof of income or other reliable evidence from a governmental agency or governmental means-tested program of the applicant’s gross annual household income.

(b) The applicant shall certify that the representations made in the documents submitted as proof of financial eligibility and in the application for the policy are true, correct, and contain no material misrepresentations or omissions of fact to the best knowledge and belief of the applicant.

(c) The certified producer shall forward the application, supporting documents, and the applicant’s certification to the California Automobile Assigned Risk Plan.

history: (History: Amended by Stats. 2019, Ch. 274, Sec. 3. (SB 570) Effective January 1, 2020.)


text:
(a) A certified producer shall provide to an applicant for a low-cost automobile insurance policy under this article a notice relating to coverage under the policy. The notice shall be provided in a separate document at the time of application and include the following statement in 14-point boldface type:“NoticeThis policy provides liability coverage for injuries or death caused to other persons in the total amount of ten thousand dollars ($10,000) per person in any one accident, and up to a total amount of twenty thousand dollars ($20,000) for all persons in any one accident. The policy also provides up to three thousand dollars ($3,000) in liability coverage for property damage in any one accident.

These limits are very low compared to coverage outside of the low-cost automobile program.

If you are at fault for an accident where the damage exceeds the coverage provided by this policy, you can be held personally responsible for the losses.

If you want higher coverage limits, you must purchase a different policy.This policy does not cover damage to your own vehicle caused by you or anyone else. The plan offers uninsured motorist coverage as an option. However, comprehensive coverage and collision coverage are only available for purchase outside of the program.This policy does not cover your bodily injury or your death. You do have the option to purchase uninsured motorist bodily injury coverage in the total amount of ten thousand dollars ($10,000) per person in any one accident and up to a total amount of twenty thousand dollars ($20,000) for all persons in any one accident. You also have the option to purchase medical payments coverage in the amount of one thousand dollars ($1,000) per person in any one accident.This policy does not cover any other driver in your household who meets any of the following criteria:(1) Is under 16 years of age.(2) Has less than three years of continuously licensed driving experience (unless the policy includes a surcharge for this driver).(3) Has more than one at-fault property damage only accident in which the driver was principally at fault in the last three years.

(4) Has more than one point for a moving violation in the last three years.

(5) Has both one at-fault property damage only accident in which the driver was principally at fault and one point for a moving violation in the last three years.(6) Has had an at-fault accident in the previous 3 years involving bodily injury or death.(7) Has a felony or misdemeanor conviction from a violation of the Vehicle Code on their motor vehicle record.” (b) When the certified producer establishes delivery of the disclosure form specified in subdivision (a) by obtaining the signature of the applicant or insured, there shall be a conclusive presumption that the certified producer has complied with the disclosure requirements of this section.

history: (History: Repealed and added by Stats. 2019, Ch. 274, Sec. 5. (SB 570) Effective January 1, 2020.)


text:
(a) (1) For a low-cost automobile insurance policy issued pursuant to the program, certified producers shall be entitled to the same commission rate as is paid by the California Automobile Assigned Risk Plan for private passenger, nonfleet risks under Article 4 (commencing with Section 11620). The commission rate prescribed in this paragraph shall only be in effect until the conditions described in paragraph (2) are fulfilled.

(2) Effective upon the setting of policy rates in 2015 pursuant to Section 11629.72, for a low-cost automobile insurance policy issued pursuant to the program, certified producers shall be entitled to a commission rate of 12 percent or fifty dollars ($50), whichever is greater.

(b) Notwithstanding subdivision (a), the commissioner may at any time establish a commission for a low-cost automobile insurance policy issued pursuant to the program and may make the commission effective on any policy originated within an entire year, or any portion of a year, as is needed to provide an incentive to certified producers to sell low-cost automobile insurance to eligible applicants. The commissioner shall not establish a commission pursuant to this subdivision if the commissioner determines that setting the commission rate will result in a lower commission than the commission paid by the California Automobile Assigned Risk Plan for private passenger, nonfleet risks under Article 4 (commencing with Section 11620).

(c) No other fees of any kind may be charged or collected pursuant to this section and the sale of a low-cost policy under this article shall not be conditioned on the purchase of any other product or service.

history: (History: Amended by Stats. 2014, Ch. 487, Sec. 7. (SB 1273) Effective January 1, 2015.)


text:
(a) A low-cost automobile insurance policy issued pursuant to the program shall be canceled only for the following reasons:

(1) Nonpayment of premium.

(2) Fraud or material misrepresentation affecting the policy or the insured.

(3) The purchase of additional automobile liability insurance coverage in violation of subdivision (a) of Section 11629.78.

(4) The purchase or maintenance of automobile liability insurance coverage other than a low-cost policy for any additional vehicles in the insured’s household, in violation of subdivision (b) of Section 11629.78.

(b) A policy shall be nonrenewed only for the following reasons:

(1) A substantial increase in the hazard insured against.

(2) The insured no longer meets the applicable eligibility requirements. In this regard, the eligibility of an insured shall be recertified by the California Automobile Assigned Risk Plan after the first year of eligibility, and every three years thereafter by the insurer that issued the policy.

history: (History: Amended by Stats. 2019, Ch. 274, Sec. 6. (SB 570) Effective January 1, 2020.)


text:
(a) An insured under the program shall not purchase automobile liability insurance coverage that is in addition to the liability coverage provided by the low-cost policy. However, the insured may purchase any other additional type of automobile insurance coverage, such as uninsured motorist coverage or collision coverage outside the plan.

(b) No more than two low-cost policies per person are permitted.

history: (History: Amended by Stats. 2019, Ch. 274, Sec. 7. (SB 570) Effective January 1, 2020.)


text:
(a) The California Automobile Assigned Risk Plan shall report to the commissioner on an annual basis, and at those additional times as it deems prudent, on the status of the program. The report shall include data regarding new policies, renewed policies, and policy cancellations or nonrenewals.

(b) The department shall combine the reports pursuant to subdivision (a) with the report required by Section 11629.85 and submit the combined report to the Legislature on or before March 15, 2024, and on or before March 15 every five years thereafter.

(c) A report submitted pursuant to subdivision (b) shall be submitted in compliance with Section 9795 of the Government Code.

history: (History: Amended by Stats. 2023, Ch. 350, Sec. 1. (AB 917) Effective January 1, 2024.)


text: Nothing in this article is intended to amend or otherwise affect or interpret any provision of Proposition 103, approved by the electors on November 8, 1988, and no provision of that initiative measure applies to this article.

history: (History: Added by Stats. 1999, Ch. 794, Sec. 2. Effective January 1, 2000.)


text:
(a) (1) Notwithstanding Section 10231.5 of the Government Code, on or before March 15, 2024, and on or before March 15 every year thereafter, the commissioner shall prepare and propose a plan in a report setting forth the methods the commissioner intends to implement to inform households eligible for the program about the availability of low-cost automobile insurance.

(2) The commissioner shall submit the report identified in paragraph (1) to the Legislature on an annual basis on or before March 15, 2024, March 15, 2025, and March 15, 2026, and every five years thereafter, beginning with the report due on or before March 15, 2031.

(3) The report identified in paragraph (1) shall be posted on the department’s and the California Automobile Assigned Risk Plan’s internet websites, beginning with the report due on or before March 15, 2024.

(b) The plan shall include, at a minimum, a brief description of methods proposed to be used, anticipated costs, sources of revenue, goals, targets, objectives, and a justification of the proposed methods. The plan shall also explain how the department proposes to work in cooperation with the California Automobile Assigned Risk Plan, the social service agencies, the Department of Motor Vehicles, and community-based organizations in order to inform eligible households of the existence of the program.

(c) The plan shall also include all of the following:

(1) The commissioner’s determination regarding whether the program has been successful, based on the criteria specified in subdivision (d), and an explanation regarding that success or lack thereof.

(2) In cooperation with the California Automobile Assigned Risk Plan, structural characteristics of the program that may require statutory revision in order for the program to succeed or to improve upon existing success.

(3) Impediments to success of the program that can reasonably be overcome by revision to the strategies adopted by the department.

(4) A detailed explanation of the department’s use for the program of funds assessed pursuant to Section 1872.81 for the reporting period.

(5) For the previous five calendar years, a list of the total low-cost auto premiums for each county in which the program was available.

(d) The program is successful if the following occur:

(1) The program generated sufficient premiums to cover losses incurred under policies issued under the program, and expenses incurred by the program, as calculated pursuant to subdivision (c) of Section 11629.72.

(2) The program served the public purpose of offering access to automobile insurance to otherwise underserved communities in the program areas.

(3) The program offered access to automobile insurance to previously uninsured motorists seeking affordable coverage in the program areas.

(4) The program’s outreach efforts lead uninsured motorists to contact a producer, and the driver obtains any auto insurance policy that complies with California law.

(e) Any written or oral advertisements, including, but not limited to, paid or unpaid commercial or noncommercial advertising, by the department with reference to the low-cost automobile insurance program shall reference the department and shall not reference the commissioner by name or office, or include the commissioner’s voice, image, or likeness. The department shall not participate with any nongovernmental entity that produces or intends to produce advertisements or educational material that include the name of the commissioner or their voice, image, or likeness, and that are intended to make eligible households aware of the existence of low-cost automobile insurance.

(f) A report submitted pursuant to subdivision (a) shall be submitted in compliance with Section 9795 of the Government Code.

history: (History: Amended by Stats. 2023, Ch. 350, Sec. 2. (AB 917) Effective January 1, 2024.)


text:
(a) A California Automobile Assigned Risk Plan certified producer may accept and process an application to purchase a low-cost automobile insurance policy under this program through an Internet Web site, in accordance with this section and regulations adopted by the department pursuant to this section.

(b) Any producer seeking certification to accept and process low-cost automobile insurance policy applications through an Internet Web site shall notify the California Automobile Assigned Risk Plan of its intentions to do so prior to accepting any applications to the program.

(c) Prior to accepting payment and upon transmitting any information from the consumer, the producer’s Internet Web site shall include a clear explanation of whether the consumer will be afforded insurance coverage upon payment and, if not, when the consumer will receive coverage and how he or she will receive notice of coverage.

(d) A producer accepting and processing applications through an Internet Web site shall be entitled to the same commission available to a producer selling a low-cost automobile insurance policy by any other means acceptable under the law.

(e) Any producer accepting and processing applications through an Internet Web site is subject to the laws and rules governing this program and is liable for any errors and omissions related to the transaction of insurance to the same extent as a producer selling a low-cost automobile insurance policy by any other means acceptable under the law.

(f) Any consumer information required by this article may be accepted by electronic means after the department adopts regulations implementing this section and only if the information is submitted in accordance with those regulations.

(g) The California Automobile Assigned Risk Plan shall coordinate with the department in order to develop a system for receiving and assigning policies issued through Internet Web sites.

(h) The California Automobile Assigned Risk Plan may request, and the department may include in its plan submitted pursuant to Section 11629.85, up to fifty thousand dollars ($50,000) from the department’s existing consumer outreach fund to be used for the sole purpose of implementing this section.

history: (History: Amended by Stats. 2014, Ch. 487, Sec. 12. (SB 1273) Effective January 1, 2015.)


text:
The department shall, in consultation with the CAARP Advisory Committee, establish and maintain a consumer-oriented internet website that provides all of the following:

(a) Referral to a list of certified agents or brokers with an office in the same geographic area as the consumer who may be contacted to purchase a low-cost automobile insurance policy.

(b) Information about the eligibility requirements, benefits, and limits of the low-cost automobile insurance policy.

(c) Notification that if a consumer does not qualify for the low-cost automobile insurance policy, other policies may be available from producers or insurers, and directing the consumer to the department’s automobile insurance premium comparison internet web page.

history: (History: Amended by Stats. 2019, Ch. 274, Sec. 11. (SB 570) Effective January 1, 2020.)


text: An applicant shall not be required to provide a copy of the applicant’s or other household member’s driver’s license, if the Department of Insurance finds that there is another suitable means of verifying the driver’s licensure.

history: (History: Added by Stats. 2011, Ch. 401, Sec. 3. (AB 1024) Effective January 1, 2012.)


text: A person who meets the requirements of subdivision (a) of Section 11629.73, and who claims that he or she meets the requirements of subdivisions (b) to (e), inclusive, of Section 11629.73 based entirely or partially on a driver’s license and driving experience obtained other than in the United States or Canada, shall be entitled to a rebuttable presumption that he or she is qualified to purchase a low-cost automobile insurance policy under the program if he or she has been licensed to drive pursuant to a license obtained in the United States or Canada for at least the previous 18 months and meets the criteria of subdivisions (b) to (e), inclusive, for that period.

history: (History: Amended by Stats. 2005, Ch. 435, Sec. 6. Effective January 1, 2006.)


text:
(a) An agent or broker, hereafter referred to as a producer, who conducts business in a county in which a low-cost automobile insurance policy is available pursuant to this article shall inform every new prospective automobile insurance policyholder who requests a minimum limits or basic limits insurance policy, or coverage to meet California’s minimum limits automobile insurance requirements, that the low-cost automobile insurance policy may be available for qualifying motorists. The information may be provided orally if the producer has been contacted by telephone, or in writing, but shall be communicated to the policyholder prior to the application for automobile insurance coverage in the language in which the producer has otherwise communicated with the consumer.

(b) If the consumer requests more information about the low-cost program the producer shall do either of the following:

(1) If the producer is California Automobile Assigned Risk Plan certified, provide the consumer with an explanation in an information pamphlet produced by the California Automobile Assigned Risk Plan and approved and provided by the Department of Insurance of the qualifications, cost, and coverage provided by the policy. If the consumer qualifies for the low-cost policy and wishes to purchase the policy, the California Automobile Assigned Risk Plan certified producer shall provide the application and, upon completion, submit the application, supporting documents, and the applicant’s certification to the California Automobile Assigned Risk Plan. The submittal of the California Automobile Assigned Risk Plan application may be in addition to any other coverage offered or applied for through the producer.

(2) If the producer is not California Automobile Assigned Risk Plan certified, the producer shall provide the consumer with the toll-free telephone number for the California Automobile Assigned Risk Plan or the program’s Internet Web site address as an option to coverage offered by the producer.

history: (History: Amended by Stats. 2014, Ch. 487, Sec. 5. (SB 1273) Effective January 1, 2015.)


text: As used in this chapter, the term “compensation” means the benefits insured by workers’ compensation insurance.

history: (History: Amended by Stats. 1979, Ch. 373.)

chapter: 2. Workers’ Compensation Policies

article: 1. Definitions

path: 2. CLASSES OF INSURANCE > 3. LIABILITY, WORKERS' COMPENSATION, AND COMMON CARRIER LIABILITY INSURANCE > 2. Workers’ Compensation Policies > 1. Definitions


text: As used in this chapter, the term “insurer” includes the State Compensation Insurance Fund.

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

article: 1. Definitions


text: Every contract insuring against liability for compensation and every compensation policy is conclusively presumed to contain all of the provisions required by this article.

article: 2. Policy Provisions

path: 2. CLASSES OF INSURANCE > 3. LIABILITY, WORKERS' COMPENSATION, AND COMMON CARRIER LIABILITY INSURANCE > 2. Workers’ Compensation Policies > 2. Policy Provisions


text: Every such contract or policy shall contain a clause to the effect that the insurer will be directly and primarily liable to any proper claimant for payment of any compensation for which the employer is liable, subject to the provisions, conditions and limitations of the policy.

article: 2. Policy Provisions


text: Every such contract or policy shall contain a clause to the effect that, as between the employee and the insurer, notice to or knowledge of the occurrence of the injury on the part of the employer will be deemed notice or knowledge, as the case may be, on the part of the insurer.

article: 2. Policy Provisions


text: Every such contract or policy shall contain a clause to the effect that jurisdiction of the employer will, for the purpose of the law imposing liability for compensation, be jurisdiction of the insurer.

article: 2. Policy Provisions


text: Every such contract or policy shall contain a clause to the effect that the insurer will in all things be bound by and subject to the orders, findings, decisions or awards rendered against the employer under the provisions of the law imposing liability for compensation, subject to the provisions, conditions and limitations of the policy. The insurance contract shall govern as between the employer and insurer as to payments by either in discharge of the employer’s liability for compensation.

article: 2. Policy Provisions


text: Such policy shall not contain any provisions relieving the insurer from payment when the employer becomes insolvent or obtains a discharge in bankruptcy, or otherwise, during the period that the policy is in operation or the compensation remains owing.

history: (History: Amended by Stats. 2009, Ch. 500, Sec. 56. (AB 1059) Effective January 1, 2010.)

article: 2. Policy Provisions


text: Such policy shall also provide that the employee has a first lien upon any amount which becomes owing to the employer from the insurer on account of the policy, and that in case of the legal incapacity or inability of the employer to receive the money and pay it to the claimant, the insurer will pay it directly to the claimant. To the extent of such payment, the obligations of the employer to the claimant are thereby discharged.

article: 2. Policy Provisions


text: Upon request of the State Department of Social Services, the State Compensation Insurance Fund may issue one workers’ compensation insurance policy insuring all recipients of in-home supportive services under Article 7 (commencing with Section 12300), Chapter 3, Part 3, Division 9 of the Welfare and Institutions Code for whom and to the extent that the State Department of Social Services has an obligation to perform or assure the performance of rights, duties and obligations relating to such services as specified in Section 12302.2 of the Welfare and Institutions Code.

history: (History: Added by renumbering Section 11656.7 by Stats. 1979, Ch. 373.)

article: 2. Policy Provisions


text: In order to permit employees of small farms to be brought under the provisions of the Workers’ Compensation Law, employers of agricultural labor who are members of any nonprofit agricultural association or who are members of, or stockholders in, any nonprofit cooperative agricultural marketing association of producers, some or all of whom may not be required to carry compensation insurance, may, under such conditions as the commissioner may prescribe in order to effectuate the purpose of Article 2, Chapter 3, of this part, be insured under a group compensation insurance policy.

history: (History: Amended by Stats. 1990, Ch. 293, Sec. 1.)

article: 2. Policy Provisions


text:
An insurer may issue a workers’ compensation policy insuring an organization or association of employers as a group if the organization or association complies with the following conditions:

(a) Files with the commissioner or a licensed workers’ compensation rating organization designated by him or her the following:

(1) A copy of its articles of incorporation and bylaws or its agreement of association and rules and regulations governing the conduct of its business, all certified by the custodian of the originals thereof.

(2) A statement setting forth its reasons for desiring insurance as a group.

(3) A statement certifying that at least 75 percent of its regular membership is engaged in a common trade or business, and an agreement that the percentage of membership will be maintained during the time that a group workers’ compensation policy issued to the organization or association is in force.

(4) An agreement that only those members who are engaged in a common trade or business shall be named by the organization or association in any statement to the commissioner, a licensed workers’ compensation rating organization, or insurer as eligible for insurance as a member of the group, and an agreement that it will immediately notify its insurer if any member of the organization fails to remain a member in good standing in accordance with the basic law, rules, and regulations of the organization or association.

(5) A statement in writing undertaking to establish and maintain a safety committee which, by education and otherwise, will seek to reduce the incidence and severity of accidents.

(6) An agreement in writing duly executed stating that, if the insurer notifies the organization or association of the nonpayment of a premium by an insured member of the organization or association within 60 days after the premium was due, the organization or association may be liable to pay to the insurer the amount of any past due premium that does not exceed the amount of the dividends that are due to the organization or association or its members from the insurer.

However, this agreement shall not be required, nor shall an organization or association be liable for payment, unless the governing board of the organization or association and the insurer agree in writing to use dividends due for the payment of past due premiums. The organization or association shall promptly notify the insurer of the known insolvency of any member of the group plan, and shall request, upon learning of the insolvency, removal of the member from the group plan. A copy of the resolution of the governing board of the organization or association authorizing the execution of the agreement shall be filed with the commissioner or a licensed workers’ compensation rating organization designated by the commissioner and with any insurer issuing a group policy.

(b) “Common trade or business,” as used in this article, shall mean:

(1) In agricultural enterprises, operations in which the principal payroll of the employer develops under any combination of the classifications of the Manual of Rules, Classifications and Basic Rates of Workers’ Compensation Insurance approved by the Insurance Commissioner as applicable to farms, nurserymen, cultivating or gardening of flowers, and classifications embracing other operations that may be conducted by a nonprofit cooperative association composed of producer members and combinations of nonprofit cooperative agricultural marketing associations having a central organization composed of member associations.

(2) In the building and construction industry, operations in the construction or repair of commercial or residential buildings or in general engineering construction in which the principal payroll develops under any combination of the classifications applicable to the construction or repair as they appear in the Manual of Rules, Classifications and Basic Rates for Workers’ Compensation Insurance approved by the Insurance Commissioner. Commercial buildings, as defined in this paragraph, shall mean any nonresidential buildings.

(3) In the transportation and warehousing industry, operations in which the principal payroll of the employer develops under any combination of the classifications of the Manual of Rules, Classifications and Basic Rates of Workers’ Compensation Insurance approved by the Insurance Commissioner as applicable to for-hire motor carriers subject to regulation by the Public Utilities Commission and warehousemen.

(4) In the timber and lumber industry, operations in which the principal payroll of the employer develops under any combination of the classifications of the Manual of Rules, Classifications and Basic Rates of Workers’ Compensation Insurance approved by the Insurance Commissioner as applicable to land clearing, logging or lumbering, log, chip, and lumber hauling, planing or molding mills, sawmills or shingle mills, veneer or veneer products manufacturing, box or box shook manufacturing, cabinet works, door, door frame, or sash manufacturing and wood fiber preparation. However, no classification applicable to for-hire motor carriers under the provisions of paragraph (3) of this subdivision shall be included in any combination of classifications authorized by this paragraph.

(5) For public agencies providing industrial, domestic, or agricultural water service, operations in which the principal payroll of the employer develops under any combination of the classifications of the Manual of Rules, Classifications and Basic Rates of Workers’ Compensation Insurance approved by the Insurance Commissioner as applicable to irrigation, drainage, reclamation, or waterworks operations.

(6) For sheltered workshops and rehabilitation facilities licensed pursuant to Section 1191.5 of the Labor Code, operations in which the principal payroll of the employer develops under any combination of classifications of the Manual of Rules, Classifications and Basic Rates of Workers’ Compensation Insurance approved by the Insurance Commissioner.

(7) For all other enterprises, operations in which the principal payroll develops under a single manual classification or a combination of classifications under which a group policy may be issued pursuant to subdivision (d).

(8) For manufacturing facilities as identified in Sector 31 to 33, inclusive, of the North American Industry Classification System (NAICS), operations in which the principal payroll of the employer develops under any combination of classifications of the Manual of Rules, Classifications, and Basic Rates of Workers’ Compensation Insurance approved by the Insurance Commissioner applicable to establishments engaged in the mechanical, physical, or chemical transformation of materials, substances, or components into new products.

(c) Except as provided in subdivision (d), “principal payroll,” for the purpose of this section, means not less than 51 percent of the total payroll for the preceding policy year or, in the case of an employer who has no preceding full year’s payroll, not less than 51 percent of his or her estimated annual payroll. Principal or estimated annual payroll shall not include the payroll of those employees set forth in the standard exceptions contained in the Manual of Rules, Classifications, and Basic Rates of Workers’ Compensation Insurance approved by the Insurance Commissioner.

(d) An insurer may issue a workers’ compensation policy insuring an organization or association of employers as a group if, in addition to complying with the conditions set forth in subdivision (a), the organization or association has had at least 50 percent of its present membership for at least one year prior to the issuance of the policy, and not less than 75 percent of the payroll of each employer to be insured under the group policy developed under the same two manual classifications, or either of them, for the preceding policy year or, in the case of an employer who has had no preceding full-year’s payroll, not less than 75 percent of his estimated annual payroll develops under the classification or classifications. However, no classification applicable to for-hire motor carriers under the provisions of paragraph (3) of subdivision (b) shall be included in any combination of classifications authorized by this subdivision.

history: (History: Amended by Stats. 2003, Ch. 641, Sec. 1. Effective January 1, 2004.)

article: 2. Policy Provisions