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Monday, 09 May 2011 19:47

CA Senate Committee Blocks Bill That Sought to Boost Insurance Commissioner’s Penalty Powers

The California Senate Insurance Committee has blocked SB 631, a restitution bill that would give explicit authority to the California Insurance Commissioner to order restitution as part of an enforcement action against an insurance company, as of May 9.

The insurance agent and broker community opposed Senate Bill 631, arguing it would have given the commissioner "unprecedented new powers to punish broker-agents and other licensees ‘in all instances’ where he finds any violation of the California Insurance Code,’" according to Insurance Brokers and Agents of the West. According to Sen. Noreen Evans, who sponsored the bill, existing law permits the commissioner to order restitution in some circumstances, Commissioner Dave Jones’ office believed that even when there are legal violations in which Californians are entitled to refunds or restitution, in many circumstances the commissioner had no specific authority to order refunds or restitution under current law.

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