Insurance Commissioner Dave Jones applauds Assembly passage of AB 584
News: 2013 Press Release
SACRAMENTO - Insurance Commissioner Dave Jones announced today that the California State Assembly passed AB 584, which is authored by Assembly Members Henry Perea (D-Fresno) and Ken Cooley (D-Rancho Cordova), on a strong bipartisan vote of 73-0. The bill is sponsored by Commissioner Jones and the Department of Insurance. It requires insurers and insurance groups to assess the adequacy of their risk management systems.
"I am pleased the Assembly approved this measure," said Commissioner Jones. "AB 584 protects consumers by helping to make sure insurers do not collapse like some big financial institutions did in 2008."
The near collapse of AIG during the 2008 economic crisis revealed the need for insurers and insurance groups to better evaluate their risks. In response, the National Association of Insurance Commissioners created and adopted a Risk Management and Own Risk Solvency Assessment Model Law to establish the regulatory oversight needed to assess an insurer's or insurance group's ability to weather severe economic stress.
AB 584 requires insurers with annual premiums greater than $500 million and insurance groups with annual premiums greater than $1 billion to maintain a comprehensive risk management system and to file a report annually with the Commissioner detailing the risks identified and the sufficiency of their capital to support the risks.
AB 584 now moves to the Senate for consideration.
The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $288 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $394 million in claims and premiums. Please visit the Department of Insurance web site at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.HELP or 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.