Monday, October 09, 2006

California Approves Changes to Insurance Law

California recently signed into law a bill making numerous changes in the law regulating insurance, including a small change to surplus lines.

The change for the surplus lines industry is a requirement requiring surplus lines brokers who make late monthly payments of premium taxes to pay interest. Under the law, surplus lines brokers granted an extension of the time in which to remit the 3% payment must pay a fee of 1% per month, or fraction thereof.

Also, the bill would revise provisions relating to cancellation and reinstatement of financed insurance, codify current policy of the Department of Insurance regarding agents of nonresident licensees, as specified, modify insurer liquidation procedure, and change the definition of "commercially domiciled insurer" for purposes of regulating insurance holding companies. There are also provisions allowing the merger of foreign and domestic mutual holding companies.

The bill also makes numerous changes to the State Compensation Insurance Fund The bill revises provisions relating to the authority of the Insurance Commissioner to revoke or suspend the State Compensation Insurance Fund's authority to transact workers' compensation insurance.

Additional information on the bill can be found through the NAPSLO Legislation Bill Tracking Service.

No comments: