Plain English Breakdown
The effective date is not listed in the provided source material.
New Rules, Penalties, and Coverage Changes for California FAIR Plan Association
This law requires the California FAIR Plan Association to fix rule violations found by officials or face fines, while also giving the Insurance Commissioner power to change policy limits and add new renters' coverage options.
What This Bill Does
- Requires the association to take specific steps to fix violations of laws, rules, or guidelines identified in official reports.
- Sets a fine of up to $20,000 if the association does not fix problems by an agreed date.
- Allows fines of up to $10,000 for each rule violation and up to $20,000 if the violation was willful (intentional).
- Requires the Insurance Commissioner to impose these penalties when rules are broken as specified in the law.
- Authorizes the commissioner to require changes to policy limits available under association programs.
Who It Names or Affects
- The California FAIR Plan Association
- Insurers licensed to write basic property insurance in California that participate in the association
Terms To Know
- California FAIR Plan Association
- A group of all insurers licensed for basic property insurance that provides coverage to people who cannot buy it through normal channels.
- Corrective actions
- Specific steps the association must take, as ordered by officials, to fix mistakes or rule violations found in reports.
Limits and Unknowns
- The official text does not state when these new rules will officially start.
- Fines depend on whether a violation was intentional and how many times it happened.