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Assembly Committee To Hear Key Insurance Bills

SACRAMENTO, CA, April 13, 2017 - Next Wednesday, April 19, looms large as the California Assembly Insurance Committee is scheduled to hear a number of key insurance bills.  Many of these measures are being heavily lobbied behind the scenes, as sponsors attempt to garner sufficient support to move their bills successfully out of the committee. 

Key measures expected to be heard next week include: 

AB 206 

AB 206 would eliminate the 52-hour threshold for household workers and day laborers to be covered for workers’ compensation injures under a homeowners or renters policy.  The bill faces heavy opposition, including from insurance industry interests.

Observers believe the bill, sponsored by workers’ compensation applicants’ attorneys, does not currently have enough votes to get the bill out of the committee, but they have attempted to persuade the Latino Caucus in the Legislature to make this a priority, and may take amendments that would limit its application to day laborers.

As drafted, the bill does not make clear whether the additional insured exposure would be priced under workers’ comp rating laws, or under the Prop. 103 prior approval rating laws that govern other property/casualty risks.  If the latter, it is possible that homeowners and renters could see a large increase in premiums under this legislation, according to Erin Norwood, of Norwood & Associates, which represents IIABCal and other insurance industry clients. Here is the current text of the bill.

AB 44

AB 44 is another workers’ comp bill that would exempt medical treatment for employees or first responders who sustain physical or psychological injury as a result of an act of terrorism or violence in the workplace from the utilization review process and the independent medical review process.  The bill would also provide for an expedited proceeding before the Workers’ Compensation Appeals Board to resolve disputes regarding treatment.

The Department of Industrial Relations, as well as Assembly Insurance Committee Chairman Tom Daly, have indicated they want to limit the exemption in AB 44 to terrorist events declared by the Governor, and require in those circumstances that employers hire an ombudsman or third party to ensure that work comp benefits are being provided as needed and without unreasonable delays.

It is not clear whether the sponsor of the legislation is willing to take those amendments. Here is the current text of the bill.

AB 1295

AB 1295 would extend temporary disability payments where an injured worker prevails in a Utilization Review or Independent Medical Review.  However, organized labor is not expected to support the bill, and employers, insurers, and the Governor are all opposed to its passage. Here is the current text of the bill.

AB 1422

Existing workers’ compensation law requires any lien filed by a medical provider be automatically stayed upon the filing of criminal charges against that physician or provider for an offense involving fraud against the work comp system, medical billing fraud, insurance fraud, or fraud against the Medicare or Medi-Cal programs.  Existing law makes the stay effective from the time of the filing of the charges until the disposition of the criminal proceedings.

AB 1422 would instead make the automatic stay effective until the adjudication procedures have been completed. Here is the current text of the bill.

AB 1641

AB 1641 would authorize the California Department of Insurance to permit automatic exportation into the non-admitted insurance market any coverages for new, innovative products for which a reasonable or adequate market among admitted insurers has not had time to develop. The bill would also authorize additions to the “export list” to be made after a hearing. Here is the current text of the bill.

AB 1679

This bill would enact a new automobile body labor rate bill.  AB 1679 would require insurers to report to CDI results from their auto body repair rate surveys.  Auto bodyshop legislation has been highly controversial in past years, but observers believe this bill may, with amendments, have sufficient support to get out of committee. Here is the current text of the bill.