Bill Text: CA AB2323 | 2021-2022 | Regular Session | Amended
Bill Title: Insurance: covered communications.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2022-04-20 - In committee: Set, first hearing. Held without recommendation. [AB2323 Detail]
Download: California-2021-AB2323-Amended.html
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Amended
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April 18, 2022 |
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Amended
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April 07, 2022 |
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March 31, 2022 |
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March 21, 2022 |
CALIFORNIA LEGISLATURE—
2021–2022 REGULAR SESSION
Assembly Bill
No. 2323
| Introduced by Assembly Member Levine |
February 16, 2022 |
An act to add and repeal Article 2.5 (commencing with Section 12945.01) of Chapter 2 of Division 3 of the Insurance Code, relating to insurance.
LEGISLATIVE COUNSEL'S DIGEST
AB 2323, as amended, Levine.
Insurance: covered communications.
Existing law establishes the Department of Insurance, an independent department, headed by the Insurance Commissioner. Existing law requires the commissioner to perform all duties imposed by the Insurance Code and other laws regulating the business of insurance. Existing law provides that communications to the commissioner or a person in the commissioner’s office concerning the holder of, or applicant for, a certificate or license issued under the Insurance Code are made to the commissioner in official confidence. Existing law requires the commissioner to receive complaints and inquiries, investigate complaints, and prosecute insurers or production agencies, if appropriate. Existing law allows the commissioner to meet with persons or entities interested in the enforcement of insurance laws and the dissemination of information regarding insurance laws to the public.
This bill would prohibit a “covered communication,” as defined, between the commissioner or a commissioner appointee, as defined, and an “interested party,” as defined, unless the covered communication is disclosed and made public, as specified, with a report to be published on the department’s internet website. The bill would define “covered communication” for these purposes to mean any oral or written communication between the commissioner or a commissioner appointee and an interested person about a matter within the commissioner’s jurisdiction that does not occur in a public hearing or other official proceeding, or on the official record of the proceeding on the matter. The bill would prohibit the commissioner or a commissioner appointee from making, or using their official position to influence, a decision in which a covered communication has not been disclosed, as specified, and would make a violation subject to a $7,500 civil fine and other costs. The bill would
make related findings and a declaration. The bill would repeal these provisions on January 1, 2025.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NOBill Text
The people of the State of California do enact as follows:
SECTION 1.
Article 2.5 (commencing with Section 12945.01) is added to Chapter 2 of Division 3 of the Insurance Code, to read:Article 2.5. Ethics and Transparency Act
12945.01.
(a) The people of California find and declare that the duties, responsibilities, and quasi-judicial actions of the insurance commissioner and staff of the department are sensitive and extremely important for the well-being of current and future generations and that the public interest and principles of fundamental fairness and due process of law require that the Insurance Commissioner and department staff conduct their affairs in an open, objective, and impartial manner free of undue influence and the abuse of power and authority. It is further found that, to be effective, California’s regulation of the business of insurance requires public awareness, understanding, support, participation, and confidence in the commissioner, department staff, and their practices and procedures. Accordingly, this article is necessary to preserve the public’s welfare and the integrity of, and to maintain the public’s trust in the commissioner and department staff.(b) The people of California further find that in a democracy, due process, fairness, and the responsible exercise of authority are all essential elements of good government which require that the public’s business be conducted in public meetings, with limited exceptions for sensitive personnel matters and litigation, and on the official record. Reasonable restrictions are necessary and proper to prevent future abuses and misuse of governmental power so long as all members of the public are given adequate opportunities to present their views and opinions to the commission through written or oral communications on the
official record either before or during the public hearing on any matter before the department.
12945.02.
For purposes of this article, “a matter within the commissioner’s jurisdiction” means any action, program, plan, review, investigation, exam, contact, communication, or any other administrative, quasi-judicial, judicial, or regulatory matter set forth in the Insurance Code.12945.03.
For purposes of this article, “commissioner appointee” means a department employee appointed by the commissioner, including the senior deputy commissioner, general counsel, or special counsel.12945.04.
(a) For purposes of this article, except as provided in subdivision (b), a “covered communication” is any oral or written communication between the commissioner or a commissioner appointee and an interested person about a matter within the commissioner’s jurisdiction that does not occur in a public hearing or other official proceeding, or on the official record of the proceeding on the matter.(b) The following communications are not covered communications:
(1) A communication between a department staff member acting in their official capacity and another department staff.
(2) A communication limited entirely to procedural issues, including, but not limited to, the hearing schedule, location, format, or filing date.
(3) A communication that takes place on the record during an official proceeding of a public agency that involves the commissioner or a commissioner appointee.
(4) A communication between the commissioner or a commissioner appointee with regard to an action of another public agency, and an official or employee of that agency, including a person who is acting as an attorney for the agency.
(5) Any communication between the commissioner or a commissioner appointee and a staff member of a public agency in which
both the commissioner or the commissioner appointee and the staff member of the public agency are acting in an official capacity.
(6) A communication between the commissioner or a commissioner appointee and a Member or employee of the Legislature related to an action pending before the commissioner or department or related to state or federal legislation or rulemaking.
(c) For purposes of subdivision (b), “public agency” means a federal, state, or local agency.
12945.05.
For purposes of this article, an “interested person” is any of the following:(a) An individual or entity licensed pursuant to the Insurance Code, an individual or entity applying for a license pursuant to the Insurance Code, an agent or an employee of the applicant, or a person receiving consideration for representing the applicant, or a participant in the proceeding on a matter before the department.
(b) A person with a financial interest, as described in Article 1 (commencing with Section 87100) of Chapter 7 of Title 9 of the Government Code, in a matter before the department, or an agent or employee of the person with a
financial interest, or a person receiving consideration for representing the person with a financial interest.
(c) A representative acting on behalf of a consumer, civic, environmental, neighborhood, business, labor, trade, or similar organization who intends to influence the decision of the commissioner or a commissioner appointee on a matter before the department.
12945.06.
(a) The commissioner or a commissioner appointee shall not make a covered communication unless the commissioner or the commissioner appointee discloses and makes public the covered communication by reporting the communication to the department within seven days after the communication. The department shall publish all reports of covered communications quarterly on the department’s internet website.(b) (1) The department shall adopt standard disclosure forms for reporting covered communications that shall include, but not be limited to, all of the following information:
(A) The
date, time, and location of the communication.
(B) (i) The identity of the person or persons initiating and the person or persons receiving the communication.
(ii) The identity of the person on whose behalf the communication was made.
(iii) The identity of all persons present during the communication.
(C) The topic of the communication.
(2) The department shall place on the department’s internet website any report of a covered communication.
(c) Communications shall cease to be covered communications when fully
disclosed and placed on the department’s internet website.
12945.07.
(a) The commissioner or a commissioner appointee shall not make, participate in making, or in any other way attempt to use their official position to influence a decision about which the commissioner or the commissioner appointee has knowingly had a covered communication that has not been reported pursuant to Section 12945.06.(b) In addition to any other applicable penalty, the commissioner or a commissioner appointee who knowingly violates this section shall be subject to a civil fine, not to exceed seven thousand five hundred dollars ($7,500). Notwithstanding any law, the court may award attorney’s fees and costs to the prevailing
party.
12945.08.
This article does not prohibit a person or an interested person from testifying at a departmental hearing, workshop, or other official proceeding, or from submitting written comments for the record on a matter before the commissioner or the department. Written comments shall be submitted by mail or delivered to a department office, or via electronic conveyance as specified by the department.12945.09.
(a) This article is intended to be in addition to, and supplemental to, other existing law governing covered communications. Nothing in this article is intended to supersede the requirements of existing law related to the confidentiality of communications or documents.(b) This article shall remain in effect only until January 1,
2025, and as of that date is repealed.
