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INSURERS: BULLETIN 99-03

DATE: February 23, 1999

TO: All Admitted Insurers and Other Interested Parties

SUBJECT: California Department of Insurance Schedule of Fees and Charges

This Bulletin is to inform affected parties that the Department of Insurance will increase by ten percent the fee schedule for all producers and companies operating in the State of California. The fee increase will become effective July 1, 1999.

Under California law (Insurance Code Section 12978), the Department is authorized to increase the fees contained in the Insurance Code to provide sufficient revenue to fund the appropriation authorized by the annual Budget Act. The Department has not increased fees subject to Section 12978 since October 1991.

Given the competitive insurance marketplace fostered under Commissioner Quackenbush's first term, and the Commissioner's desire to increase consumer protection activities, the announcement of a fee increase at this time is appropriate. The increased revenues will provide funding for additional investigative and claim services positions for the Department. This, combined with other staffing increases, will enable the Department to double the number of company claims files reviewed by claims services staff, reduce the investigation caseload backlog to zero cases in three years, provide one-hundred percent investigation of all third-party claims, and achieve a four-fold increase in the number of market conduct exams.

In addition, the increased revenues will also provide funds to continue the investigative and consumer

services positions authorized by SB 18 (Rosenthal). This bill was signed by the Governor (Chapter 239/97) in 1997 to provide limited, one-time funding for three fiscal years, and it expires June 30, 2000.

A subsequent Bulletin with the new fee schedule will be distributed in March 1999.

PLEASE BE SURE THIS INFORMATION IS DISSEMINATED TO ALL DISTRICT OFFICES AND GENERAL AGENTS IN CALIFORNIA

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