Calif. Panel Approves Measure Requiring Insurers to Explain Why Policies are Declined

July 7, 2005

The California Assembly Insurance Committee approved an amended measure that will now require insurers to provide an explanation to consumers when policies are declined, canceled or non-renewed, reported the American Insurance Association (AIA). The bill, SB 150, authored by Senator Martha Escutia (D-Whittier), was originally opposed by AIA. The senator removed the language regulating underwriting criteria, however, thus removing AIA’s objections.

“We appreciate Senator Escutia’s willingness to address our reservations with this measure,” said Janine Gibford, AIA assistant vice president, Western Region. “SB 150 will now help homeowners to understand and recognize their potential risks or hazards so they can rectify the condition. This bill provides important new consumer education.”

SB 150 was approved by the Assembly Insurance Committee by a vote of 7 to 3. The bill will now move to the floor for a full vote by the California State Assembly.

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