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Taxonomy: CaliforniaInsurance Code
General Provisions of California Insurance Code
This act shall be known as the Insurance Code.
The provisions of this code in so far as they are substantially
the same as existing statutory provisions relating to the same
subject matter shall be construed as restatements and continuations
thereof, and not as new enactments.
All persons who, at the time this code goes into effect, hold
office under any of the acts repealed by this code, which offices are
continued by this code, continue to hold the same according to the
former tenure thereof.
No action or proceeding commenced before this code takes effect,
and no right accrued, is affected by the provisions of this code,
but all procedure thereafter taken therein shall conform to the
provisions of this code so far as possible.
Unless the context otherwise requires, the general provisions
hereinafter set forth shall govern the construction of this code.
Division, part, chapter, article, and section headings contained
herein shall not be deemed to govern, limit, modify or in any manner
affect the scope, meaning, or intent of the provisions of any
division, part, chapter, article, or section hereof.
Whenever, by the provisions of this code, a power is granted to
a public officer or a duty imposed upon such an officer, the power
may be exercised or the duty performed by a deputy of the officer or
by a person authorized pursuant to law by the officer, unless it is
expressly otherwise provided.
Writing includes any form of recorded message capable of
comprehension by ordinary visual means. Whenever any notice, report,
statement or record is required or authorized by this code, it shall
be made in writing in the English language unless it is otherwise
expressly provided.
Whenever any reference is made to any portion of this code or of
any other law of this State, such reference shall apply to all
amendments and additions thereto now or hereafter made.
"Section" means a section of this code unless some other
statute is specifically mentioned and "subdivision" or "subsection"
means a subdivision or subsection of the section in which that term
occurs unless some other section is expressly mentioned.
The present tense includes the past and future tenses; and the
future, the present.
The masculine gender includes the feminine and neuter.
The singular number includes the plural, and the plural the
singular.
"County" includes "city and county."
"City" includes "city and county."
As used in this code the word "shall" is mandatory and the word
"may" is permissive, unless otherwise apparent from the context.
"Oath" includes affirmation.
"Signature" or "subscription" includes mark when the signer or
subscriber can not write, such signer's or subscriber's name being
written near the mark by a witness who writes his own name near the
signer's or subscriber's name; but a signature or subscription by
mark can be acknowledged or can serve as a signature or subscription
to a sworn statement only when two witnesses so sign their own names
thereto.
"Person" means any person, association, organization,
partnership, business trust, limited liability company, or
corporation.
"Commissioner" means the Insurance Commissioner of this State.
Whenever in this code the terms "State Industrial Accident
Commission" or "Industrial Accident Commission" or "commission,"
relating to the said "State Industrial Accident Commission" or the
said "Industrial Accident Commission," appear, said terms shall mean
"Division of Industrial Accidents," including "administrative
director" of said division or "appeals board," or both, as the
context may require.
"Division," and "department," in reference to the government of
this state, mean the Department of Insurance of this state.
(a) "Administrative law bureau" or "administrative hearing
bureau" means the unit within the Department of Insurance that
provides administrative hearings.
(b) An administrative law judge appointed by the commissioner pursuant to civil service rules shall be employed within the administrative law bureau and shall not be supervised directly by the commissioner or supervised directly or indirectly by an employee in the legal branch of the department.
(b) An administrative law judge appointed by the commissioner pursuant to civil service rules shall be employed within the administrative law bureau and shall not be supervised directly by the commissioner or supervised directly or indirectly by an employee in the legal branch of the department.
Insurance is a contract whereby one undertakes to indemnify
another against loss, damage, or liability arising from a contingent
or unknown event.
The person who undertakes to indemnify another by insurance is
the insurer, and the person indemnified is the insured.
"Admitted," in relation to a person, means entitled to transact
insurance business in this state, having complied with the laws
imposing conditions precedent to transaction of such business. The
State Compensation Insurance Fund shall be deemed to be admitted
pursuant to authority to transact workers' compensation insurance
granted by the Legislature. The commissioner shall not revoke or
suspend the State Compensation Insurance Fund's authority to transact
workers' compensation insurance.
"Nonadmitted," in relation to a person, means not entitled to
transact insurance business in this State, whether by reason of
failure to comply with conditions precedent thereto, or by reason of
inability so to comply.
"Domestic" means organized under the laws of this State,
whether or not admitted.
"Foreign" means not organized under the laws of this State,
whether or not admitted.
"State" means the State of California, unless applied to the
different parts of the United States. In the latter case, it includes
the District of Columbia, the commonwealths and the territories.
"Mortgage" includes a trust deed, "mortgagor" includes a
trustor under such trust deed, "mortgagee" includes a beneficiary
under such trust deed, or a trustee exercising powers or performing
duties granted to or imposed upon him thereunder, and "lien" in
respect to real or personal property includes a charge or incumbrance
arising out of a trust deed.
"Resident" means residing in this State, "nonresident" means
not residing in this State.
"Insurance agent" means a person authorized, by and on behalf
of an insurer, to transact all classes of insurance other than life,
disability, or health insurance, on behalf of an admitted insurance
company.
(a) A life licensee is a person authorized to act as a life
agent on behalf of a life insurer or a disability insurer to transact
any of the following:
(1) Life insurance.
(2) Accident and health insurance.
(3) Life and accident and health insurance.
(b) Licenses to act as a life agent under this chapter shall be of the types as set forth in Section 1626.
(c) A life agent may be authorized to transact 24-hour care coverage, as defined in Section 1749.02, pursuant to the requirements of subdivision (d) of Section 1749 or subdivision (b) of Section 1749.33.
(1) Life insurance.
(2) Accident and health insurance.
(3) Life and accident and health insurance.
(b) Licenses to act as a life agent under this chapter shall be of the types as set forth in Section 1626.
(c) A life agent may be authorized to transact 24-hour care coverage, as defined in Section 1749.02, pursuant to the requirements of subdivision (d) of Section 1749 or subdivision (b) of Section 1749.33.
"Life and disability insurance analyst" means a person who,
for a fee or compensation of any kind, paid by or derived from any
person or source other than an insurer, advises, purports to advise,
or offers to advise any person insured under, named as beneficiary
of, or having any interest in, a life or disability insurance
contract, in any manner concerning that contract or his or her rights
in respect thereto.
"Insurance broker" means a person who, for compensation and on
behalf of another person, transacts insurance other than life,
disability, or health with, but not on behalf of, an insurer.
(a) "Casualty broker-agent" means a person licensed pursuant
to Section 1625.
(b) "Property broker-agent" means a person licensed pursuant to Section 1625.
(b) "Property broker-agent" means a person licensed pursuant to Section 1625.
"Insurance solicitor" means a natural person employed to aid a
property and casualty broker-agent acting as an insurance agent or
insurance broker in transacting insurance other than life,
disability, or health.
"Transact" as applied to insurance includes any of the
following:
(a) Solicitation.
(b) Negotiations preliminary to execution.
(c) Execution of a contract of insurance.
(d) Transaction of matters subsequent to execution of the contract and arising out of it.
(a) Solicitation.
(b) Negotiations preliminary to execution.
(c) Execution of a contract of insurance.
(d) Transaction of matters subsequent to execution of the contract and arising out of it.
"Paid-in capital" or "capital paid-in" means:
(a) In the case of a foreign mutual insurer not issuing or having outstanding capital stock, the value of its assets in excess of the sum of its liabilities for losses reported, expenses, taxes, and all other indebtedness and reinsurance of outstanding risks as provided by law. Such foreign mutual insurer shall not be admitted, however, unless its paid-in capital is composed of available cash assets amounting to at least $200,000.00.
(b) In the case of a foreign joint stock and mutual insurer, its paid-in capital computed, according to its desire, pursuant to the provisions of subdivision (a) or subdivision (c) of this section. If computed pursuant to the provisions of subdivision (a), its admission is subject to the qualification therein expressed.
(c) In the case of all other insurers, the lower of the following amounts:
(1) The value of its assets in excess of the sum of its liabilities for losses reported, expenses, taxes, and all other indebtedness and reinsurance of outstanding risks as provided by law.
(2) The aggregate par value of its issued shares of stock, including treasury shares. For the purpose of computing paid-in capital or capital paid-in, shares of stock are not taken as liabilities.
(a) In the case of a foreign mutual insurer not issuing or having outstanding capital stock, the value of its assets in excess of the sum of its liabilities for losses reported, expenses, taxes, and all other indebtedness and reinsurance of outstanding risks as provided by law. Such foreign mutual insurer shall not be admitted, however, unless its paid-in capital is composed of available cash assets amounting to at least $200,000.00.
(b) In the case of a foreign joint stock and mutual insurer, its paid-in capital computed, according to its desire, pursuant to the provisions of subdivision (a) or subdivision (c) of this section. If computed pursuant to the provisions of subdivision (a), its admission is subject to the qualification therein expressed.
(c) In the case of all other insurers, the lower of the following amounts:
(1) The value of its assets in excess of the sum of its liabilities for losses reported, expenses, taxes, and all other indebtedness and reinsurance of outstanding risks as provided by law.
(2) The aggregate par value of its issued shares of stock, including treasury shares. For the purpose of computing paid-in capital or capital paid-in, shares of stock are not taken as liabilities.
Provisions of this code relating to a particular class of
insurance or a particular type of insurer prevail over provisions
relating to insurance in general or insurers in general.
Unless expressly otherwise provided, any notice required to be
given to any person by any provision of this code may be given by
mailing notice, postage prepaid, addressed to the person to be
notified, at his residence or principal place of business in this
State. The affidavit of the person who mails the notice, stating the
facts of such mailing, is prima facie evidence that the notice was
thus mailed.
(a) Any written notice required to be given or mailed to any
person by an insurer relating to any insurance on risks or on
operations in this state not excepted by subdivision (a), (b), (c),
(d), (e), or (g) of Section 1851 from the coverage of Chapter 9
(commencing with Section 1850.4) of Part 2 of Division 1 of this code
may, if not excluded by subdivision (b) or (c) of Section 1633.3 of
the Civil Code, be provided by electronic transmission pursuant to
Title 2.5 (commencing with Section 1633.1) of Part 2 of Division 3 of
the Civil Code, if each party has agreed to conduct the transaction
by electronic means pursuant to Section 1633.5 of the Civil Code. The
affidavit of the person who initiated the electronic transmission,
stating the facts of that transmission into an information processing
system outside of the control of the sender or of any person that
sent the electronic record on behalf of the sender, is prima facie
evidence that the notice was transmitted and shall be sufficient
proof of notice. Any notice provided by electronic transmission shall
be treated as if mailed or given for the purposes of any provision
of this code, except as provided by subdivision (g) of Section
1633.15 of the Civil Code. The insurance company shall maintain a
system for confirming that any notice or document that is to be
provided by electronic means has been sent in a manner consistent
with Section 1633.15 of the Civil Code. A valid electronic signature
shall be sufficient for any provision of law requiring a written
signature. The insurance company shall retain a copy of the
confirmation and electronic signature, when either is required, with
the policy information so that they are retrievable upon request by
the Department of Insurance while the policy is in force and for five
years thereafter.
(b) The offer of renewal required by Sections 663 and 678, the notice of conditional renewal required by Section 678.1, and the offer of coverage or renewal or any disclosure required by Section 10086 and the offer of renewal for a workers' compensation policy may be provided by electronic transmission if an insurer complies with all of the following:
(1) An insurer, or insurer's representative, acquires the consent of the insured to opt in to receive the offer, notice, or disclosure by electronic transmission, and the insured has not withdrawn that consent, prior to providing the offer, notice, or disclosure by electronic transmission. An insured's consent may be acquired verbally, in writing, or electronically. If consent is acquired verbally, the insurer shall confirm consent in writing or electronically. The insurer shall retain a record of the insured's consent to receive the offer, notice, or disclosure by electronic transmission with the policy information so that it is retrievable upon request by the Department of Insurance while the policy is in force and for five years thereafter.
(2) An insurer discloses, in writing or electronically, to the insured all of the following:
(A) The opt in to receive the offer, notice, or disclosure by electronic transmission is voluntary.
(B) That the insured may opt out of receiving the offer, notice, or disclosure by electronic transmission at any time, and the process or system for the insured to opt out.
(C) A description of the offer, notice, or disclosure that the insured will receive by electronic transmission.
(D) The process or system to report a change or correction in the insured's email address.
(E) The insurer's contact information, which includes, but is not limited to, a toll-free number or an insurer's Internet Web site address.
(3) An insurer shall include the insured's email address on the policy declaration page.
(4) An insurer shall annually provide one free printed copy of any offer, notice, or disclosure described in this subdivision upon request by the insured.
(5) An insurer shall maintain a process or system that can demonstrate that the offer, notice, or disclosure provided by electronic transmission was both sent and received consistent with Section 1633.15 of the Civil Code. If a different method of sending or receiving is agreed upon by the insurer and the insured pursuant to Section 1633.15 of the Civil Code, an insurer shall comply with the provisions of this subdivision. The insurer shall retain and document information so that the documentation and information is retrievable upon request by the Department of Insurance while the current policy is in force and for five years thereafter related to its process or system demonstrating that the offer, notice, or disclosure provided by electronic transmission was sent to the insured by the applicable statutory regular mail delivery deadlines and received electronically. The offer, notice, or disclosure provided by electronic transmission shall be treated as if mailed so long as the insurer delivers it to the insured in compliance with the applicable statutory regular mail delivery deadlines.
(A) Acceptable methods for an insurer to demonstrate that the offer, notice, or disclosure was sent to the insured include simple mail transfer protocol server log files indicating transmission, or other methodologies indicating sent transmission consistent with standards set forth in Section 1633.15 of the Civil Code.
(B) Acceptable methods for an insurer to demonstrate that the offer, notice, or disclosure was received by the insured include server log files indicating that the email or application has been received, or log files showing that the insured logged into his or her secured account with the insurer, or other methodologies indicating received transmission consistent with standards set forth in Section 1633.15 of the Civil Code.
(6) If the offer, notice, or disclosure is not delivered directly to the electronic address designated by the insured, but placed at an electronic address accessible to the insured, an insurer shall notify the insured in plain, clear, and conspicuous language at the electronic address designated by the insured that describes the offer, notice, or disclosure, informs that insured that it is available at another location, and provides instructions to the insured as to how to obtain the offer, notice, or disclosure.
(7) (A) Upon an insurer receiving information indicating that the offer, notice, or disclosure sent by electronic transmission was not received by the insured, the insurer shall, within two business days, either clause (i) or (ii):
(i) Contact the insured to confirm or update the insured's email address and resend the offer, notice, or disclosure by electronic transmission. If the insurer elects to resend the offer, notice, or disclosure by electronic transmission, the insurer shall demonstrate the transmission was received by the insured, pursuant to paragraph (5). If the insurer is unable to confirm or update the insured's email address, the insurer shall resend the offer, notice, or disclosure by regular mail to the insured at the address shown on the policy.
(ii) Resend the offer, notice, or disclosure initially provided by electronic transmission by regular mail to the insured at the address shown on the policy.
(B) If the insurer sends the first electronic offer, notice, or disclosure within the time period required by law and the insurer complies with both paragraph (5) and subparagraph (A) of this paragraph, the electronic offer, notice, or disclosure sent pursuant to clause (i) or (ii) of subparagraph (A) shall be treated as if mailed in compliance with the applicable statutory regular mail delivery deadlines.
(8) On or before January 1, 2018, the commissioner shall submit a report to the Governor and to the committees of the Senate and Assembly having jurisdiction over insurance and the judiciary, regarding the impact and implementation of the authorization of the electronic transmission of certain insurance renewal offers, notices, or disclosures as authorized by this section. The report shall include input from insurers, consumers, and consumer organizations, and shall include an assessment of the department's experience pertaining to the authorization of the electronic transmission of insurance renewals as authorized by this section.
(c) The department may suspend an insurer from providing offers, notices, or disclosures by electronic transmission if there is a pattern or practices that demonstrate the insurer has failed to comply with the requirements of this section. An insurer may appeal the suspension and resume its electronic transmission of offers, notices, or disclosures upon communication from the department that the changes the insurer made to its process or system to comply with the requirements of this section are satisfactory.
(d) This section shall remain in effect only until January 1, 2019, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2019, deletes or extends that date.
(b) The offer of renewal required by Sections 663 and 678, the notice of conditional renewal required by Section 678.1, and the offer of coverage or renewal or any disclosure required by Section 10086 and the offer of renewal for a workers' compensation policy may be provided by electronic transmission if an insurer complies with all of the following:
(1) An insurer, or insurer's representative, acquires the consent of the insured to opt in to receive the offer, notice, or disclosure by electronic transmission, and the insured has not withdrawn that consent, prior to providing the offer, notice, or disclosure by electronic transmission. An insured's consent may be acquired verbally, in writing, or electronically. If consent is acquired verbally, the insurer shall confirm consent in writing or electronically. The insurer shall retain a record of the insured's consent to receive the offer, notice, or disclosure by electronic transmission with the policy information so that it is retrievable upon request by the Department of Insurance while the policy is in force and for five years thereafter.
(2) An insurer discloses, in writing or electronically, to the insured all of the following:
(A) The opt in to receive the offer, notice, or disclosure by electronic transmission is voluntary.
(B) That the insured may opt out of receiving the offer, notice, or disclosure by electronic transmission at any time, and the process or system for the insured to opt out.
(C) A description of the offer, notice, or disclosure that the insured will receive by electronic transmission.
(D) The process or system to report a change or correction in the insured's email address.
(E) The insurer's contact information, which includes, but is not limited to, a toll-free number or an insurer's Internet Web site address.
(3) An insurer shall include the insured's email address on the policy declaration page.
(4) An insurer shall annually provide one free printed copy of any offer, notice, or disclosure described in this subdivision upon request by the insured.
(5) An insurer shall maintain a process or system that can demonstrate that the offer, notice, or disclosure provided by electronic transmission was both sent and received consistent with Section 1633.15 of the Civil Code. If a different method of sending or receiving is agreed upon by the insurer and the insured pursuant to Section 1633.15 of the Civil Code, an insurer shall comply with the provisions of this subdivision. The insurer shall retain and document information so that the documentation and information is retrievable upon request by the Department of Insurance while the current policy is in force and for five years thereafter related to its process or system demonstrating that the offer, notice, or disclosure provided by electronic transmission was sent to the insured by the applicable statutory regular mail delivery deadlines and received electronically. The offer, notice, or disclosure provided by electronic transmission shall be treated as if mailed so long as the insurer delivers it to the insured in compliance with the applicable statutory regular mail delivery deadlines.
(A) Acceptable methods for an insurer to demonstrate that the offer, notice, or disclosure was sent to the insured include simple mail transfer protocol server log files indicating transmission, or other methodologies indicating sent transmission consistent with standards set forth in Section 1633.15 of the Civil Code.
(B) Acceptable methods for an insurer to demonstrate that the offer, notice, or disclosure was received by the insured include server log files indicating that the email or application has been received, or log files showing that the insured logged into his or her secured account with the insurer, or other methodologies indicating received transmission consistent with standards set forth in Section 1633.15 of the Civil Code.
(6) If the offer, notice, or disclosure is not delivered directly to the electronic address designated by the insured, but placed at an electronic address accessible to the insured, an insurer shall notify the insured in plain, clear, and conspicuous language at the electronic address designated by the insured that describes the offer, notice, or disclosure, informs that insured that it is available at another location, and provides instructions to the insured as to how to obtain the offer, notice, or disclosure.
(7) (A) Upon an insurer receiving information indicating that the offer, notice, or disclosure sent by electronic transmission was not received by the insured, the insurer shall, within two business days, either clause (i) or (ii):
(i) Contact the insured to confirm or update the insured's email address and resend the offer, notice, or disclosure by electronic transmission. If the insurer elects to resend the offer, notice, or disclosure by electronic transmission, the insurer shall demonstrate the transmission was received by the insured, pursuant to paragraph (5). If the insurer is unable to confirm or update the insured's email address, the insurer shall resend the offer, notice, or disclosure by regular mail to the insured at the address shown on the policy.
(ii) Resend the offer, notice, or disclosure initially provided by electronic transmission by regular mail to the insured at the address shown on the policy.
(B) If the insurer sends the first electronic offer, notice, or disclosure within the time period required by law and the insurer complies with both paragraph (5) and subparagraph (A) of this paragraph, the electronic offer, notice, or disclosure sent pursuant to clause (i) or (ii) of subparagraph (A) shall be treated as if mailed in compliance with the applicable statutory regular mail delivery deadlines.
(8) On or before January 1, 2018, the commissioner shall submit a report to the Governor and to the committees of the Senate and Assembly having jurisdiction over insurance and the judiciary, regarding the impact and implementation of the authorization of the electronic transmission of certain insurance renewal offers, notices, or disclosures as authorized by this section. The report shall include input from insurers, consumers, and consumer organizations, and shall include an assessment of the department's experience pertaining to the authorization of the electronic transmission of insurance renewals as authorized by this section.
(c) The department may suspend an insurer from providing offers, notices, or disclosures by electronic transmission if there is a pattern or practices that demonstrate the insurer has failed to comply with the requirements of this section. An insurer may appeal the suspension and resume its electronic transmission of offers, notices, or disclosures upon communication from the department that the changes the insurer made to its process or system to comply with the requirements of this section are satisfactory.
(d) This section shall remain in effect only until January 1, 2019, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2019, deletes or extends that date.
(a) Any written notice required to be given or mailed to any
person by an insurer relating to any insurance on risks or on
operations in this state not excepted by Section 1851 from the
coverage of Chapter 9 (commencing with Section 1850.4) of Part 2 of
Division 1 of this code may, if not excluded by subdivision (b) or
(c) of Section 1633.3 of the Civil Code, be provided by electronic
transmission pursuant to Title 2.5 (commencing with Section 1633.1)
of Part 2 of Division 3 of the Civil Code, if each party has agreed
to conduct the transaction by electronic means pursuant to Section
1633.5 of the Civil Code. The affidavit of the person who initiated
the electronic transmission, stating the facts of that transmission
into an information processing system outside of the control of the
sender or of any person that sent the electronic record on behalf of
the sender, is prima facie evidence that the notice was transmitted
and shall be sufficient proof of notice. Any notice provided by
electronic transmission shall be treated as if mailed or given for
the purposes of any provision of this code, except as provided by
subdivision (g) of Section 1633.15 of the Civil Code. The insurance
company shall maintain a system for confirming that any notice or
document that is to be provided by electronic means has been sent in
a manner consistent with Section 1633.15 of the Civil Code. A valid
electronic signature shall be sufficient for any provision of law
requiring a written signature. The insurance company shall retain a
copy of the confirmation and electronic signature, when either is
required, with the policy information so that they are retrievable
upon request by the Department of Insurance while the policy is in
force and for five years thereafter.
(b) This section shall become operative on January 1, 2019.
(b) This section shall become operative on January 1, 2019.
(a) (1) Any written record required to be given or mailed to
any person by a licensee relating to the business of life insurance,
as defined in Section 101 of this code may, if not excluded by
subdivision (b) or (c) of Section 1633.3 of the Civil Code, be
provided by electronic transmission pursuant to Title 2.5 (commencing
with Section 1633.1) of Part 2 of Division 3 of the Civil Code, if
each party has agreed to conduct the transaction by electronic means
pursuant to Section 1633.5 of the Civil Code, and if the licensee
complies with the provisions of this section. A valid electronic
signature shall be sufficient for any provision of law requiring a
written signature.
(2) For purposes of this section, the definitions set forth in Section 1633.2 of the Civil Code shall apply. The term "licensee" means an insurer, agent, broker, or any other person who is required to be licensed by the department.
(3) Notwithstanding subdivision (l) of Section 1633.2 of the Civil Code, for purposes of this section, "person" includes, but is not limited to, the policy owner, policyholder, applicant, insured, or assignee or designee of an insured.
(b) In order to transmit a life insurance record electronically, a licensee shall comply with all of the following:
(1) A licensee, or licensee's representative, acquires the consent of the person to opt in to receive the record by electronic transmission, and the person has not withdrawn that consent, prior to providing the record by electronic transmission. A person's consent may be acquired verbally, in writing, or electronically. If consent is acquired verbally, the licensee shall confirm consent in writing or electronically. The licensee shall retain a record of the person's consent to receive the record by electronic transmission with the policy information so that it is retrievable upon request by the department while the policy is in force and for five years thereafter.
(2) A licensee discloses, in writing or electronically, to the person all of the following:
(A) The opt in to receive the record by electronic transmission is voluntary.
(B) That the person may opt out of receiving the record by electronic transmission at any time, and the process or system for the person to opt out.
(C) A description of the record that the person will receive by electronic transmission.
(D) The process or system to report a change or correction in the person's email address.
(E) The licensee's contact information, which includes, but is not limited to, a toll-free number or the licensee's Internet Web site address.
(3) The opt-in consent disclosure required by paragraph (2) may be set forth in the application or in a separate document that is part of the policy approved by the commissioner and shall be bolded or otherwise set forth in a conspicuous manner. The person's signature shall be set forth immediately below the opt-in consent disclosure. If the licensee seeks consent at any time prior to the completion of the application, consent and signature shall be obtained before the application is completed. If the person has not opted in at the time the application is completed, the licensee may receive the opt-in consent at any time thereafter, pursuant to the same opt in requirements that apply at the time of the application. The licensee shall retain a copy of the signed opt-in consent disclosure with the policy information so that each is retrievable upon request by the department while the policy is in force and for five years thereafter.
(4) The email address of the person who has consented to electronic transmission shall be set forth on the consent disclosure. In addition, if the person who consented receives an annual statement, the email address of the person who has consented shall be set forth on that record.
(5) The licensee shall annually provide one free printed copy of any record described in this subdivision upon request by the person.
(6) If a provision of this code requires a licensee to transmit a record by first class mail, regular mail, does not specify a method of delivery, or is a record that is required to be provided pursuant to Article 6.6 (commencing with Section 791), and if the licensee is not otherwise prohibited from transmitting the record electronically under subdivision (b) of Section 1633.8 of the Civil Code, then the record may be transmitted by electronic transmission if the licensee complies with all of the requirements of Sections 1633.15 and 1633.16 of the Civil Code.
(7) Notwithstanding subdivision (b) of Section 1633.8 of the Civil Code, if a provision of this code requires a licensee to transmit a record by return receipt, registered mail, certified mail, signed written receipt of delivery, or other method of delivery evidencing actual receipt by the person, and if the licensee is not otherwise prohibited from transmitting the record electronically under Section 1633.3 of the Civil Code and the provisions of this section, then the licensee shall maintain a process or system that demonstrates proof of delivery and actual receipt of the record by the person consistent with this paragraph. The licensee shall document and retain information demonstrating delivery and actual receipt so that it is retrievable, upon request, by the department at least five years after the policy is no longer in force. The record provided by electronic transmission shall be treated as if actually received if the licensee delivers the record to the person in compliance with applicable statutory delivery deadlines. A licensee may demonstrate actual delivery and receipt by any of the following:
(A) The person acknowledges receipt of the electronic transmission of the record by returning an electronic receipt or by executing an electronic signature.
(B) The record is made part of, or attached to, an email sent to the email address designated by the person, and there is a confirmation receipt, or some other evidence that the person received the email in his or her email account and opened the email.
(C) The record is posted on the licensee's secure Internet Web site, and there is evidence demonstrating that the person logged onto the licensee's secure Internet Web site and downloaded, printed, or otherwise acknowledged receipt of the record.
(D) If a licensee is unable to demonstrate actual delivery and receipt pursuant to this paragraph, the licensee shall resend the record by regular mail to the person in the manner originally specified by the underlying provision of this code.
(8) Notwithstanding any other law, a notice of lapse, nonrenewal, cancellation, or termination of any product subject to this section may be transmitted electronically if the licensee demonstrates proof of delivery as set forth in paragraph (7) and complies with the other provisions in this section.
(9) If the record is not delivered directly to the electronic address designated by the person but placed at an electronic address accessible to the person, a licensee shall notify the person in plain, clear, and conspicuous language at the electronic address designated by the person that describes the record, informs that person that it is available at another location, and provides instructions to the person as to how to obtain the record.
(10) (A) Upon a licensee receiving information indicating that the record sent by electronic transmission was not received by the person, the licensee shall, within five business days, comply with either clause (i) or (ii):
(i) Contact the person to confirm or update the person's email address and resend the record by electronic transmission. If the licensee elects to resend the record by electronic transmission, the licensee shall demonstrate the transmission was received by the person, pursuant to paragraph (6), (7), or (8). If the licensee is unable to confirm or update the person's email address, the licensee shall resend the record by regular mail to the licensee at the address shown on the policy, or, if the underlying statute requires delivery in a specified manner, send the record in that specified manner.
(ii) Resend the record initially provided by electronic transmission by regular mail to the insured at the address shown on the policy, or, if the underlying statute requires delivery in a specified manner, send the record in that specified manner.
(B) If the licensee sends the first electronic record within the time period required by law and the licensee complies with both paragraph (5) and subparagraph (A) of this paragraph, the record sent pursuant to clause (i) or (ii) of subparagraph (A) shall be treated as if mailed in compliance with the applicable statutory regular mail delivery deadlines.
(11) The licensee shall not charge any person who declines to opt in to receive a record through electronic transmission from receiving a record electronically. The licensee shall not provide a discount or an incentive to any person to opt in to receive electronic records.
(12) The licensee shall verify a person's email address via paper writing sent by regular mail when more than 12 months have elapsed since the license's last electronic communication.
(c) An insurance agent or broker acting under the direction of a party that enters into a contract by means of an electronic record or electronic signature shall not be held liable for any deficiency in the electronic procedures agreed to by the parties under that contract if all of the following are met:
(1) The insurance agent or broker has not engaged in negligent, reckless, or intentional tortious conduct.
(2) The insurance agent or broker was not involved in the development or establishment of the electronic procedures.
(3) The insurance agent or broker did not deviate from the electronic procedures.
(d) On or before January 1, 2020, the commissioner shall submit a report to the Governor and to the committees of the Senate and Assembly having jurisdiction over insurance and the judiciary, regarding the impact and implementation of the authorization of the electronic transmission of certain insurance renewal offers, notices, or disclosures as authorized by this section. The report shall include input from insurers, consumers, and consumer organizations, and shall include an assessment of the department's experience pertaining to the authorization of the electronic transmission of insurance renewals as authorized by this section.
(e) Notwithstanding paragraph (4) of subdivision (b) of Section 1633.3 of the Civil Code, for any policy of life insurance, as defined in Section 101, any statutory requirement for a separate acknowledgment, signature, or initial, which is not expressly prohibited by subdivision (c) of Section 1633.3 of the Civil Code, may be transacted using an electronic signature, or by electronic transaction, subject to all applicable provisions of this section.
(f) The department may suspend a licensee from providing records by electronic transmission if there is a pattern or practices that demonstrate the licensee has failed to comply with the requirements of this section. A licensee may appeal the suspension and resume its electronic transmission of records upon communication from the department that the changes the licensee made to its process or system to comply with the requirements of this section are satisfactory.
(g) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
(2) For purposes of this section, the definitions set forth in Section 1633.2 of the Civil Code shall apply. The term "licensee" means an insurer, agent, broker, or any other person who is required to be licensed by the department.
(3) Notwithstanding subdivision (l) of Section 1633.2 of the Civil Code, for purposes of this section, "person" includes, but is not limited to, the policy owner, policyholder, applicant, insured, or assignee or designee of an insured.
(b) In order to transmit a life insurance record electronically, a licensee shall comply with all of the following:
(1) A licensee, or licensee's representative, acquires the consent of the person to opt in to receive the record by electronic transmission, and the person has not withdrawn that consent, prior to providing the record by electronic transmission. A person's consent may be acquired verbally, in writing, or electronically. If consent is acquired verbally, the licensee shall confirm consent in writing or electronically. The licensee shall retain a record of the person's consent to receive the record by electronic transmission with the policy information so that it is retrievable upon request by the department while the policy is in force and for five years thereafter.
(2) A licensee discloses, in writing or electronically, to the person all of the following:
(A) The opt in to receive the record by electronic transmission is voluntary.
(B) That the person may opt out of receiving the record by electronic transmission at any time, and the process or system for the person to opt out.
(C) A description of the record that the person will receive by electronic transmission.
(D) The process or system to report a change or correction in the person's email address.
(E) The licensee's contact information, which includes, but is not limited to, a toll-free number or the licensee's Internet Web site address.
(3) The opt-in consent disclosure required by paragraph (2) may be set forth in the application or in a separate document that is part of the policy approved by the commissioner and shall be bolded or otherwise set forth in a conspicuous manner. The person's signature shall be set forth immediately below the opt-in consent disclosure. If the licensee seeks consent at any time prior to the completion of the application, consent and signature shall be obtained before the application is completed. If the person has not opted in at the time the application is completed, the licensee may receive the opt-in consent at any time thereafter, pursuant to the same opt in requirements that apply at the time of the application. The licensee shall retain a copy of the signed opt-in consent disclosure with the policy information so that each is retrievable upon request by the department while the policy is in force and for five years thereafter.
(4) The email address of the person who has consented to electronic transmission shall be set forth on the consent disclosure. In addition, if the person who consented receives an annual statement, the email address of the person who has consented shall be set forth on that record.
(5) The licensee shall annually provide one free printed copy of any record described in this subdivision upon request by the person.
(6) If a provision of this code requires a licensee to transmit a record by first class mail, regular mail, does not specify a method of delivery, or is a record that is required to be provided pursuant to Article 6.6 (commencing with Section 791), and if the licensee is not otherwise prohibited from transmitting the record electronically under subdivision (b) of Section 1633.8 of the Civil Code, then the record may be transmitted by electronic transmission if the licensee complies with all of the requirements of Sections 1633.15 and 1633.16 of the Civil Code.
(7) Notwithstanding subdivision (b) of Section 1633.8 of the Civil Code, if a provision of this code requires a licensee to transmit a record by return receipt, registered mail, certified mail, signed written receipt of delivery, or other method of delivery evidencing actual receipt by the person, and if the licensee is not otherwise prohibited from transmitting the record electronically under Section 1633.3 of the Civil Code and the provisions of this section, then the licensee shall maintain a process or system that demonstrates proof of delivery and actual receipt of the record by the person consistent with this paragraph. The licensee shall document and retain information demonstrating delivery and actual receipt so that it is retrievable, upon request, by the department at least five years after the policy is no longer in force. The record provided by electronic transmission shall be treated as if actually received if the licensee delivers the record to the person in compliance with applicable statutory delivery deadlines. A licensee may demonstrate actual delivery and receipt by any of the following:
(A) The person acknowledges receipt of the electronic transmission of the record by returning an electronic receipt or by executing an electronic signature.
(B) The record is made part of, or attached to, an email sent to the email address designated by the person, and there is a confirmation receipt, or some other evidence that the person received the email in his or her email account and opened the email.
(C) The record is posted on the licensee's secure Internet Web site, and there is evidence demonstrating that the person logged onto the licensee's secure Internet Web site and downloaded, printed, or otherwise acknowledged receipt of the record.
(D) If a licensee is unable to demonstrate actual delivery and receipt pursuant to this paragraph, the licensee shall resend the record by regular mail to the person in the manner originally specified by the underlying provision of this code.
(8) Notwithstanding any other law, a notice of lapse, nonrenewal, cancellation, or termination of any product subject to this section may be transmitted electronically if the licensee demonstrates proof of delivery as set forth in paragraph (7) and complies with the other provisions in this section.
(9) If the record is not delivered directly to the electronic address designated by the person but placed at an electronic address accessible to the person, a licensee shall notify the person in plain, clear, and conspicuous language at the electronic address designated by the person that describes the record, informs that person that it is available at another location, and provides instructions to the person as to how to obtain the record.
(10) (A) Upon a licensee receiving information indicating that the record sent by electronic transmission was not received by the person, the licensee shall, within five business days, comply with either clause (i) or (ii):
(i) Contact the person to confirm or update the person's email address and resend the record by electronic transmission. If the licensee elects to resend the record by electronic transmission, the licensee shall demonstrate the transmission was received by the person, pursuant to paragraph (6), (7), or (8). If the licensee is unable to confirm or update the person's email address, the licensee shall resend the record by regular mail to the licensee at the address shown on the policy, or, if the underlying statute requires delivery in a specified manner, send the record in that specified manner.
(ii) Resend the record initially provided by electronic transmission by regular mail to the insured at the address shown on the policy, or, if the underlying statute requires delivery in a specified manner, send the record in that specified manner.
(B) If the licensee sends the first electronic record within the time period required by law and the licensee complies with both paragraph (5) and subparagraph (A) of this paragraph, the record sent pursuant to clause (i) or (ii) of subparagraph (A) shall be treated as if mailed in compliance with the applicable statutory regular mail delivery deadlines.
(11) The licensee shall not charge any person who declines to opt in to receive a record through electronic transmission from receiving a record electronically. The licensee shall not provide a discount or an incentive to any person to opt in to receive electronic records.
(12) The licensee shall verify a person's email address via paper writing sent by regular mail when more than 12 months have elapsed since the license's last electronic communication.
(c) An insurance agent or broker acting under the direction of a party that enters into a contract by means of an electronic record or electronic signature shall not be held liable for any deficiency in the electronic procedures agreed to by the parties under that contract if all of the following are met:
(1) The insurance agent or broker has not engaged in negligent, reckless, or intentional tortious conduct.
(2) The insurance agent or broker was not involved in the development or establishment of the electronic procedures.
(3) The insurance agent or broker did not deviate from the electronic procedures.
(d) On or before January 1, 2020, the commissioner shall submit a report to the Governor and to the committees of the Senate and Assembly having jurisdiction over insurance and the judiciary, regarding the impact and implementation of the authorization of the electronic transmission of certain insurance renewal offers, notices, or disclosures as authorized by this section. The report shall include input from insurers, consumers, and consumer organizations, and shall include an assessment of the department's experience pertaining to the authorization of the electronic transmission of insurance renewals as authorized by this section.
(e) Notwithstanding paragraph (4) of subdivision (b) of Section 1633.3 of the Civil Code, for any policy of life insurance, as defined in Section 101, any statutory requirement for a separate acknowledgment, signature, or initial, which is not expressly prohibited by subdivision (c) of Section 1633.3 of the Civil Code, may be transacted using an electronic signature, or by electronic transaction, subject to all applicable provisions of this section.
(f) The department may suspend a licensee from providing records by electronic transmission if there is a pattern or practices that demonstrate the licensee has failed to comply with the requirements of this section. A licensee may appeal the suspension and resume its electronic transmission of records upon communication from the department that the changes the licensee made to its process or system to comply with the requirements of this section are satisfactory.
(g) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.
Insurers shall maintain a system for electronically
confirming a policyholder's decision to opt in to an agreement to
conduct transactions electronically and a system that will allow the
policyholder to electronically opt out of the agreement to conduct
business electronically as specified in subdivision (c) of Section
1633.5. The insurer shall maintain the electronic records for the
same amount of time the insurer would be required to maintain those
records if the records were in written form.
If any provision of this code, or the application thereof to
any person or circumstance, is held invalid, the remainder of the
code, or the application of such provision to other persons or
circumstances, shall not be affected thereby.
The existence of insurers formed prior to the date this code
takes effect shall not be affected by the enactment of this code nor
by any repeal of the laws under which they were formed, but such
insurers shall thereafter operate under the provisions of this code.
All insurance in this State is governed by the provisions of
this code.
The designation of insurance coverage as "group" in any code or
law of this State other than this code does not authorize its
representation as a group coverage or as a group policy, certificate
or contract by any person licensed or certificated by the
commissioner unless the policy providing the coverage is defined as
group insurance by a specific provision of this code or of the laws
of the state in which the policy, certificate or contract is issued.
This section shall apply only to life, disability and workmen's
compensation insurance.
Any person who willfully and knowingly makes, circulates, or
transmits to another any false written or printed statement for the
purpose of damaging the financial condition or stability of any
insurance company doing business in this state is guilty of a
misdemeanor punishable by a fine of not more than one thousand
dollars ($1,000).
(a) "Electronic funds transfer" means any transfer of funds,
other than a transaction originated by check, draft, or similar paper
instrument, that is initiated through an electronic terminal,
telephonic instrument, or computer or magnetic tape, so as to order,
instruct, or authorize a financial institution to debit or credit an
account. Electronic funds transfer shall be accomplished by an
automated clearinghouse debit, an automated clearinghouse credit, a
Federal Reserve Wire Transfer (Fedwire), or an international funds
transfer, at the option of the insurer.
(b) For purposes of this section:
(1) "Automated clearinghouse" means any federal reserve bank, or an organization established by agreement with the National Automated Clearing House Association, that operates as a clearinghouse for transmitting or receiving entries between banks or bank accounts and that authorizes an electronic transfer of funds between those banks or bank accounts.
(2) "Automated clearinghouse debit" means a transaction in which any department of the state, through its designated depository bank, originates an automated clearinghouse transaction debiting the taxpayer's bank account and crediting the state's bank account for the amount of tax. Banking costs incurred for the automated clearinghouse debit transaction by the taxpayer shall be paid by the state.
(3) "Automated clearinghouse credit" means an automated clearinghouse transaction in which the taxpayer, through its own bank, originates an entry crediting the state's bank account and debiting its own bank account. Banking costs incurred by the state for the automated clearinghouse credit transaction may be charged to the taxpayer.
(4) "Fedwire" means any transaction originated by the taxpayer and utilizing the national electronic payment system to transfer funds through federal reserve banks, pursuant to which the taxpayer debits its own bank account and credits the state's bank account. Electronic funds transfers may be made by Fedwire only if prior approval is obtained from the department and the taxpayer is unable, for reasonable cause, to make payments pursuant to paragraph (2) or (3). Banking costs charged to the taxpayer and to the state may be charged to the taxpayer.
(5) "International funds transfer" means any transaction originated by the taxpayer and utilizing "SWIFT," the international electronic payment system to transfer funds in which the taxpayer debits its own bank account, and credits the funds to a United States bank that credits the state's bank account. Banking costs charged to the taxpayer and to the state may be charged to the taxpayer.
(b) For purposes of this section:
(1) "Automated clearinghouse" means any federal reserve bank, or an organization established by agreement with the National Automated Clearing House Association, that operates as a clearinghouse for transmitting or receiving entries between banks or bank accounts and that authorizes an electronic transfer of funds between those banks or bank accounts.
(2) "Automated clearinghouse debit" means a transaction in which any department of the state, through its designated depository bank, originates an automated clearinghouse transaction debiting the taxpayer's bank account and crediting the state's bank account for the amount of tax. Banking costs incurred for the automated clearinghouse debit transaction by the taxpayer shall be paid by the state.
(3) "Automated clearinghouse credit" means an automated clearinghouse transaction in which the taxpayer, through its own bank, originates an entry crediting the state's bank account and debiting its own bank account. Banking costs incurred by the state for the automated clearinghouse credit transaction may be charged to the taxpayer.
(4) "Fedwire" means any transaction originated by the taxpayer and utilizing the national electronic payment system to transfer funds through federal reserve banks, pursuant to which the taxpayer debits its own bank account and credits the state's bank account. Electronic funds transfers may be made by Fedwire only if prior approval is obtained from the department and the taxpayer is unable, for reasonable cause, to make payments pursuant to paragraph (2) or (3). Banking costs charged to the taxpayer and to the state may be charged to the taxpayer.
(5) "International funds transfer" means any transaction originated by the taxpayer and utilizing "SWIFT," the international electronic payment system to transfer funds in which the taxpayer debits its own bank account, and credits the funds to a United States bank that credits the state's bank account. Banking costs charged to the taxpayer and to the state may be charged to the taxpayer.
The Legislature hereby declares its intent that the term
"workmen's compensation" shall hereafter also be known as "workers'
compensation." In furtherance of this policy it is the desire of the
Legislature that references to the term "workmen's compensation" in
this code be changed to "workers' compensation" when such code
sections are being amended for any purpose. This act is declaratory
and not amendatory of existing law.
"Surplus line broker" means a person licensed under Section
1765 and authorized to do business under Chapter 6 (commencing with
Section 1760) of Part 2 of Division 1.
A "surplus line broker certificate" means a certificate issued
by a surplus line broker to an insurance purchaser as evidence of the
placement of insurance with an eligible nonadmitted insurer in
accordance with the requirements of Sections 1764, 1764.1, and
1764.2.
