SACRAMENTO, Calif., Sept. 7 -- The California Department of Insurance issued the following news release:
Insurance Commissioner Dave Jones today announced that Governor Jerry Brown has signed SB 1448, authored by Senate Insurance Committee Chairman Ron Calderon (D-Montebello). The bill is sponsored by Commissioner Jones and the California Department of Insurance and updates California's Insurance Holding Company System Regulatory Act.
"I am pleased that the Governor has signed this important legislation," Commissioner Jones said. "Insurance Holding Company Systems are vast and complex. SB 1448 ensures that the Insurance Commissioner and the Department of Insurance have the authority and regulatory tools needed to evaluate the risks that non-insurance entities pose to an insurer in the holding company system."
The need for insurance regulators to have greater authority to evaluate the risks that non-insurance entities pose to an insurer in a holding company system was intensified by the Wall Street financial crisis in 2008. In response, the National Association of Insurance Commissioners updated its Insurance Holding Company Systems Model Laws and Regulations and SB 1448 brings these changes into California law. One principal provision in the bill would require the controlling person of the holding company system to disclose an enterprise risk. Enterprise risk is any situation involving one or more affiliates of an insurer that, if not quickly corrected, would adversely affect the financial condition of the insurer. The bill would also authorize the Insurance Commissioner to participate in "supervisory colleges." These colleges are meetings of international regulators for internationally active insurance groups to share financial and operational information.
"I would like to thank Senate Insurance Committee Chairman Ron Calderon for authoring this legislation and Governor Jerry Brown for signing it," said Commissioner Jones.
The measure will become effective January 1, 2013.
TNS 23SQ 120908-4018621 StaffFurigay