Bill Text: CA AB1140 | 2023-2024 | Regular Session | Introduced

California Assembly Bill 1140

NOTE: There are more recent revisions of this legislation. Read Latest Draft

Bill Title: Insurance.

Spectrum: Committee Bill

Status: (Passed) 2023-09-22 - Chaptered by Secretary of State - Chapter 204, Statutes of 2023. [AB1140 Detail]

Download: California-2023-AB1140-Introduced.html

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Assembly Bill

No. 1140

Introduced by Committee on Insurance

February 15, 2023

An act to amend Section 1872.41 of the Insurance Code, relating to insurance.

LEGISLATIVE COUNSEL'S DIGEST

AB 1140, as introduced, Committee on Insurance. Insurance.

Existing law establishes a Fraud Division within the Department of Insurance to investigate fraudulent claims. Existing law requires an agent or broker to use the electronic form within Fraud Division’s Consumer Fraud Reporting Portal before placing an insurance application with an insurer to report if they reasonably suspect or know that a fraudulent application is being made.

This bill would make a technical change to correct an erroneous reference in that provision.

Vote: MAJORITY Appropriation: NO Fiscal Committee: NO Local Program: NO

The people of the State of California do enact as follows:

SECTION 1.

Section 1872.41 of the Insurance Code is amended to read:

1872.41.

(a) An agent or broker who, before placing an insurance application with an insurer, reasonably suspects or knows that a fraudulent application is being made shall, within 60 days after the determination by the agent or broker that the application appears to be fraudulent, submit to the Fraud Division, using the electronic form within Fraud Division’s Consumer Fraud Reporting Portal, the information requested by the form and any additional information relative to the factual circumstances of the application and the alleged material misrepresentations contained in the application. All data fields within the Fraud Division’s Consumer Fraud Reporting Portal electronic form shall be completed accurately, to the best of the agent or broker’s ability. An agent or broker shall not submit a fraud referral anonymously. The Fraud Division shall review each report and undertake further investigation it deems necessary and proper to determine the validity of the allegations.

(b) An agent or broker who, after an insurance application has been placed with an insurer, reasonably suspects or knows that fraud has been perpetrated shall report that information directly to the insurer’s special investigative unit. An agent or broker shall furnish all papers, documents, reports, or other facts or evidence to the insurer’s special investigative unit upon request, and shall otherwise assist and cooperate with the insurer’s special investigative unit.

(c) An agent or broker shall furnish all papers, documents, reports, or other facts or evidence to the department upon request, and shall otherwise assist and cooperate with the department.

(d) (1) For purposes of this section, an “agent or broker” is a natural person licensed to transact insurance in a capacity described in Section 1625, 1625.5, 1625.55, 1626, or 1758.1 and is not the employee of an insurer.

(2) An agent or broker is not considered a “contracted entity” or “integral antifraud personnel” pursuant to Section ~~2689.30~~ 2698.30 of Title 10 of the California Code of Regulations.