The COVID Project
Context, not an orderThis record is guidance or an announcement kept for context. It is not counted among the orders in force.
The record
- Jurisdiction
- California (Insurance Commissioner) · California
- Level
- Sector regulator
- Authority
- Cal. Ins. Code 1861.01, 1861.05, 12921
- Issued
- 2020-04-13 Apr. 13, 2020
- Effective
- 2020-04-13; refunds for March and April 2020 due no later than 120 days after the bulletin (read as 2020-04-13)
- End
- Initial order covers March and April 2020. (read as 2020-09-30)
- In force
- Apr. 13, 2020 to Sept. 30, 2020
- Quarters
- 2020 Q22020 Q3
2020 Q22020 Q32020 Q42021 Q12021 Q22021 Q3
- Limitation types
- Other
- Addressees
- all property and casualty insurers and workers' compensation insurers in California (including the State Compensation Insurance Fund)
- Functions reached
- IN insurers' pricing, billing and rating systems (mandatory refunds; reclassification of exposures; payroll and receipts exposure bases reduced)
- OP commercial policyholders' premium (workers' compensation, commercial auto, commercial multiple peril and liability) reflecting 'severely curtailed activities'
- CB
- Character
- context
- Collection
- State utilities, housing and agriculture agencies AGY-ST-UTILITIES-HOUSING-AG
Operative words
Commissioner Lara hereby orders insurers to make an initial premium refund for the months of March and April to all adversely impacted California policyholders in the following lines of insurance, as quickly as practicable, but in any event no later than 120 days after the date of this Bulletin: Private passenger automobile insurance; Commercial automobile insurance; Workers' compensation insurance; Commercial multiple peril insurance; Commercial liability insurance; Medical malpractice insurance; Any other line of coverage where the measures of risk have become substantially overstated as a result of the pandemic.... In responding to this Order, insurers may take the following actions without obtaining prior approval of rates or rules by the Department of Insurance if done consistent with the insurer's existing rating plan: Reclassification of exposures to comport with current exposure, or Reduction of the exposure base (miles driven, payroll, receipts, etc.) to reflect actual or anticipated exposure.
Enforcement
Cal. Ins. Code 1858 et seq. (enforcement of rating law); Bulletin states the Commissioner 'orders' the refunds and requires reporting
Notes
The Commissioner's finding: 'The COVID-19 pandemic has severely curtailed activities of policyholders in both personal and commercial lines. As a result, projected loss exposures of many insurance policies have become overstated or misclassified. This is especially true for policies where premiums are based partly on measures of risk such as number of miles driven, revenue, and payrolls which have all dropped significantly because of COVID-19.' A regulator's contemporaneous finding that payrolls, revenue and driving 'have all dropped significantly' across commercial lines statewide.
Retrieval noteCite it as context and cite the underlying order, statute or emergency rule it describes as the instrument. (Bulletins whose operative text imposes a mandatory duty on licensees under the regulator's own authority are excluded from this downgrade and listed separately for review.)).