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Commissioner-sponsored bill to protect California seniors signed by Governor

News: 2018 Press Release

For Release: July 17, 2018
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Commissioner-sponsored bill to protect California seniors signed by Governor
New legislation improves the long-term care insurance and accelerated death benefits statutes
SACRAMENTO, Calif. — Insurance Commissioner Dave Jones announced today that a bill he sponsored to strengthen consumer protections for seniors has been signed into law by California Governor Jerry Brown. Assembly Bill 2180, authored by Assemblymember Ash Kalra (D-San Jose), makes changes in law to clarify and improve long-term care insurance and accelerated death benefits statutes.

"As California's aging population and its attendant care needs continue to grow, it is important to ensure statutory improvements like this are adopted to facilitate the policy review process and help provide Californians with more insurance policy choices," said Insurance Commissioner Dave Jones. "I thank the Governor for signing this bill and Assemblymember Kalra for championing it in the Legislature."

California is home to the largest number of seniors age 65 and older in the nation and will grow from about one in five persons by 2030 to nearly one in four in 2040 and beyond. The expanding aging population will increase the need for long-term care services and may lead to more interest in long-term care insurance as a means to finance those services.

To allow flexibility with long-term care insurance benefits, standards were established to propose an "alternate plan of care" under which an insurer would pay for services not otherwise covered by the insurance policy. Additionally, many Californians choose to protect themselves by purchasing a life insurance policy that allows them to receive an accelerated death benefit in the event of a qualifying catastrophic or chronic illness.

AB 2180 clarifies standards and processes for the certification of an insured's chronic illness, provides standardized terms and procedures for alternate plans of care, and defines certain benefit payment, claim, and application requirements with improved clarity and/or specificity. The changes in AB 2180 will help insurers write more compliant forms and will eliminate delays in the policy approval process, which in turn will help insurers bring new insurance products to market faster, while providing consumers more products to choose from. These changes are effective January 1, 2019.

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Led by Insurance Commissioner Ricardo Lara, the California Department of Insurance is the consumer protection agency for the nation's largest insurance marketplace and safeguards all of the state’s consumers by fairly regulating the insurance industry. Under the Commissioner’s direction, the Department uses its authority to protect Californians from insurance rates that are excessive, inadequate, or unfairly discriminatory, oversee insurer solvency to pay claims, set standards for agents and broker licensing, perform market conduct reviews of insurance companies, resolve consumer complaints, and investigate and prosecute insurance fraud. Consumers are urged to call 1-800-927-4357 with any questions or contact us at via webform or online chat. Non-media inquiries should be directed to the Consumer Hotline at 800-927-4357. Teletypewriter (TTY), please dial 800-482-4833.

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