Calif. Bills Make Dash for Finish Line

September 27, 2002

The 2002 California legislative session came to an end on Aug. 31, with a flurry of industry-related bills shuffling through the mix. Many new laws and measures were introduced this year by state lawmakers regarding workers’ compensation, construction defects, automobile insurance and other pertinent issues hovering over the industry today.

As agents, brokers and insurance companies sat on the edge of their seats and watched bills flow in and out of committees, the industry associations were hard at work making their voices heard. They lobbied endlessly for the passage of bills, while simultaneously opposing those that would present difficulties to the industry. The end result insofar has been a fair share of positive measures that will lead California’s insurance market to stability, but not, of course, without a few obstacles along the way.

The following bills have been passed and signed into law by Governor Gray Davis:

*AB 2007—Authored by Assemblyman Tom Calderon (D-Montebello); passed in the Assembly floor on Aug. 15; signed into law by Gov. Davis on Sept. 7. AB 2007 maintains the 2 percent maximum surcharge on insurance premiums payable to the California Insurance Guarantee Association (CIGA) through 2007, ensuring funds for payment of outstanding claims of insolvent workers’ compensation insurers. The bill will also increase the number of CIGA board members from nine to 13; members would include a business representative and a labor representative who would be appointed by the Insurance Commissioner. “We strongly supported AB 2007,” said Nicole Mahrt, director of Public Affairs, Western region, at the American Insurance Association (AIA). “We think it’s a very important measure and we’re very glad that the Governor signed it and that he signed it so quickly. Many other states already have a 2 percent assessment, so basically this brings California in line with other states. We think it’s very important that employers that are mandated to have workers’ compensation coverage and employees that rely on it when they’re injured’ we think it’s very important that the safety net be there, so that they continue to receive benefits if their carrier’s solvency is jeopardized.”

*AB 2984—Authored by the Committee on Insurance; passed on July 15; signed into law by Gov. Davis on July 29. AB 2894 will help the California Department of Insurance (CDI) maintain high licensing standards for insurance personnel in California from federal preemption. It will assist in the electronic filing of license applications.

*SB 688—Authored by Senator John Burton (D-San Francisco); passed in the Senate floor on Aug. 30; signed into law by Gov. Davis on Sept. 10. SB 688 extends the statute of limitations for filing a personal injury lawsuit from one to two years. It also extends the time the respondents have to react to summary judgment motions from 28 days to 75 days, a movement that the AIA feels will weaken the law for summary judgment motions by giving the plaintiffs more time to respond. “This is a bill that the trial laws jammed through in the last minute,” said Mahrt. “It got very little public input or scrutiny, which is an inappropriate use of the process.”

The following bills have been passed and are waiting for approval by Gov. Davis, who has until Sept. 30 to sign them into law:

To see the full story, please the Sept. 30 issue of Insurance Journal, Page 10.

Topics California Workers' Compensation

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