California 2009-2010 Regular Session Status: Enacted

AB 1708 — Insurance: surplus line brokers.

Last action — Chaptered by Secretary of State - Chapter 362, Statutes of 2010.

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  1. ✓
    Introduced
  2. ✓
    In Committee
  3. ✓
    Passed Assembly
  4. ✓
    Passed Senate
  5. ✓
    To Executive
  6. 6
    Enacted

This bill has been enacted into law. Introduced February 01, 2010. Enacted.

Prognosis

Likely to advance 70% · moderate confidence

Where this bill stands today.

Odds of enactment

High

How often bills like it became law.

  • Enacted

    Current position in the legislative process.

  • 1 sponsor

    1 primary, 0 co-sponsors signed on.

  • Cleared a recorded vote

    Passed 5 recorded votes so far.

Prognosis reads this bill's own signals — stage, sponsorship breadth, committee status, recorded votes and cross-state momentum. Odds come from a model trained on which bills have become law.

Summary

Existing law limits the ability of a surplus line broker to place any coverage with a nonadmitted insurer, as specified. In order for a nonadmitted insurer to qualify for coverage it must demonstrate financial stability, as defined. Existing law defines financial stability to include, but not be limited to, having a total of capital and surplus of at least $15,000,000 with the type of assets to be used in calculating capital and surplus being at least $15,000,000 in the form of cash, securities of a specified character, or in readily marketable securities, as defined. This bill would instead require the total capital and surplus requirement be at least $45,000,000 and the amount of assets to be used in calculating capital and surplus that consist of cash and those other specified types of securities to be at least $25,000,000. The bill would provide that if a nonadmitted insurer on the list of eligible surplus line insurers does not meet the capital and surplus requirements as of January 1, 2011, that insurer would be required to have at least $30,000,000 of capital and surplus as of December 31, 2011, and at least $45,000,000 of capital and surplus as of December 31, 2013. Existing law also defines financial stability, in the case of an Insurance Exchange created and authorized under the laws of individual states, as maintaining capital and surplus of not less than $50,000,000 in the aggregate, with the type of assets to be used in calculating capital and surplus being at least $15,000,000 in the form of cash, securities of a specified character, or in readily marketable securities. In the case of an Insurance Exchange that maintains funds for the protection of all Insurance Exchange policyholders, each individual syndicate seeking to accept surplus line placements of risks resident, located, or to be performed in this state are required to maintain minimum capital and surplus of not less than $6,400,000. Each individual syndicate is required to increase the capital and surplus required by $1,000,000 each year until it attains a capital and surplus of $15,000,000. In the case of Insurance Exchanges that do not maintain funds for the protection of all Insurance Exchange policyholders, each individual syndicate seeking to accept surplus line placement of risks resident, located, or to be performed in this state are required to meet the specified capital and surplus requirements applicable to nonadmitted insurers of at least $15,000,000 with the type of assets to be used in calculating capital and surplus being at least $15,000,000 of that in the form of cash, securities of a specified character, or in readily marketable securities. This bill would instead require the amount of assets to be used in calculating capital and surplus to be at least $25,000,000 in the form of cash, securities of a specified character, or in readily marketable securities. The bill would repeal the minimum capital and surplus requirement formula for an individual syndicate with regard to an Insurance Exchange that maintains funds for the protection of all Insurance Exchange policyholders, and would instead require each syndicate to maintain capital and surplus of not less than $45,000,000. The bill would also raise the capital and surplus requirements regarding each syndicate of Insurance Exchanges that do not maintain funds for the protection of all Insurance Exchange policyholders to $45,000,000. The bill would make conforming changes. The bill would incorporate additional changes to Section 1765.1 of the Insurance Code, proposed by AB 1837 of the 2009–10 Regular Session, to be operative only if both bills are chaptered and become effective on or before January 1, 2011, and this bill is chaptered last.

Bill Text

Action History

  1. Chaptered by Secretary of State - Chapter 362, Statutes of 2010.

  2. Approved by the Governor.

  3. Enrolled and to the Governor at 4:45 p.m.

  4. Senate amendments concurred in. To enrollment. (Ayes 77. Noes 0. Page 6382.)

  5. Assembly Rule 77 suspended. (Page 6373.)

  6. In Assembly. Concurrence in Senate amendments pending. May be considered on or after August 20 pursuant to Assembly Rule 77.

  7. Read third time, passed, and to Assembly. (Ayes 34. Noes 0. Page 4586.)

  8. Read second time. To third reading.

  9. Read third time, amended. To second reading.

  10. Ordered to third reading.

  11. From Consent Calendar.

  12. Read second time. To Consent Calendar.

  13. From committee: Do pass. To Consent Calendar. (June 16).

  14. In committee: Set, second hearing. Hearing canceled at the request of author.

  15. In committee: Set, first hearing. Hearing canceled at the request of author.

  16. From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on B., F. & I.

  17. Referred to Com. on B., F. & I.

  18. In Senate. Read first time. To Com. on RLS. for assignment.

  19. Read third time, passed, and to Senate. (Ayes 70. Noes 0. Page 4687.)

  20. Read second time. To Consent Calendar.

  21. From committee: Do pass. To Consent Calendar. (April 7).

  22. Re-referred to Com. on INS.

  23. (Corrected April 5.)

  24. From committee chair, with author's amendments: Amend, and re-refer to Com. on INS. Read second time and amended.

  25. Referred to Com. on INS.

  26. From printer. May be heard in committee March 4.

  27. Read first time. To print.

Sponsors

  • Villines · Primary

Sponsorship breakdown

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1 sponsors · 0 co-sponsors · 121 not signed on

Sponsors (1)

  • Villines

Co-sponsors (0)

None.

Not signed on (121)

121 members have not signed on to this bill.

Show all 121 →

"Not signed on" means a member has not sponsored or co-sponsored this bill — it does not imply opposition. Members flagged Voted No have a recorded No vote on this bill.

Whip count is in markup. Polling the chamber and every recorded vote this session. Only the first open is slow. It’s instant for you after this. Calling the roll · Tallying · Engrossing

Votes

AB 1708 VILLINES Concurrence in Senate Amendments

Passed 89 Yea · 0 Nay · 2 Other
Party YeaNayPresentNot Voting
Democratic 3000
Unaffiliated 83002
Republican 3000
Total 89002
% of votes cast 98%0%0%2%
How each member voted (91)
Member Party Vote
Bill — Yea
Ammiano — Yea
Anderson — Yea
Bass — Yea
Beall — Yea
John — Yea
A. — Yea
Perez — Yea
Yamada — Yea
Norby — Not Voting
Tom — Yea
Feuer — Yea
Fuentes — Yea
Furutani — Yea
Galgiani — Yea
Charles — Yea
Gilmore — Yea
Hagman — Yea
Hall — Yea
Harkey — Yea
Hayashi — Yea
Hill — Yea
De — Yea
La — Yea
Torre — Yea
De — Yea
Leon — Yea
Huber — Yea
Fletcher — Yea
Fong — Yea
Bonnie — Yea
Lowenthal — Yea
V. — Yea
Manuel — Yea
Perez — Yea
Portantino — Yea
Salas — Yea
Saldana — Yea
Audra — Yea
Carter — Yea
Chesbro — Yea
Conway — Yea
Cook — Yea
Coto — Yea
Davis — Yea
DeVore — Yea
Knight — Yea
Lieu — Yea
Mendoza — Yea
Miller — Yea
Monning — Yea
Nava — Yea
Ruskin — Yea
Silva — Yea
Skinner — Yea
Solorio — Yea
Swanson — Yea
Torres — Yea
Torrico — Yea
Adams — Yea
Blakeslee — Yea
Block — Yea
Blumenfield — Yea
Bradford — Yea
Brownley — Yea
Buchanan — Yea
Hernandez — Yea
Huffman — Yea
Jeffries — Not Voting
Logue — Yea
Ma — Yea
Nestande — Yea
Nielsen — Yea
Smyth — Yea
Torlakson — Yea
Tran — Yea
Villines — Yea
Eng — Yea
Evans — Yea
Fuller — Yea
Garrick — Yea
Gatto — Yea
Beth Gaines — Yea
Bill Berryhill — Yea
Bill Berryhill — Yea
Arambula, Joaquin Democratic Yea
Caballero, Anna M. Democratic Yea
Calderon, Lisa Democratic Yea
Jones, Brian W. Republican Yea
Niello, Roger W. Republican Yea
Strickland, Tony Republican Yea

Official roll call →

Assembly 3rd Reading AB1708 Villines By Cogdill

Passed 35 Yea · 0 Nay · 4 Other
Party YeaNayPresentNot Voting
Unaffiliated 32004
Democratic 2000
Republican 1000
Total 35004
% of votes cast 90%0%0%10%
How each member voted (39)
Member Party Vote
Yee — Yea
Hancock — Yea
Wyland — Yea
Florez — Yea
Lowenthal — Yea
Negrete — Yea
Runner — Yea
Harman — Yea
Hollingsworth — Yea
Corbett — Not Voting
Kehoe — Yea
Leno — Yea
Liu — Yea
Ashburn — Yea
Ducheny — Yea
Dutton — Yea
McLeod — Yea
Oropeza — Not Voting
Pavley — Yea
Price — Yea
Simitian — Yea
Walters — Not Voting
Wiggins — Not Voting
Wolk — Yea
Wright — Yea
Aanestad — Yea
Alquist — Yea
Huff — Yea
Romero — Yea
Steinberg — Yea
Cedillo — Yea
Cogdill — Yea
Emmerson — Yea
Correa — Yea
DeSaulnier — Yea
Denham — Yea
Calderon, Lisa Democratic Yea
Padilla, Stephen C. Democratic Yea
Strickland, Tony Republican Yea

Official roll call →

AB 1708 VILLINES Consent Calendar Second Day

Passed 82 Yea · 0 Nay · 9 Other
Party YeaNayPresentNot Voting
Unaffiliated 77008
Democratic 3000
Republican 2001
Total 82009
% of votes cast 90%0%0%10%
How each member voted (91)
Member Party Vote
Carter — Yea
Chesbro — Yea
Conway — Yea
Cook — Yea
Coto — Yea
Bill — Yea
Tom — Yea
Feuer — Yea
Fuentes — Yea
Furutani — Yea
Charles — Yea
Galgiani — Yea
Gilmore — Yea
Hagman — Yea
Hall — Yea
Harkey — Yea
Hernandez — Yea
De — Yea
La — Yea
Torre — Yea
De — Yea
Leon — Yea
Fletcher — Yea
Fong — Yea
Anderson — Yea
Beall — Yea
Blakeslee — Yea
Davis — Yea
Hill — Yea
Huffman — Yea
Jeffries — Yea
Bonnie — Yea
Lowenthal — Yea
V. — Yea
Manuel — Yea
Perez — Yea
Portantino — Yea
Salas — Yea
Saldana — Yea
Audra — Yea
John — Yea
A. — Yea
Perez — Yea
Knight — Yea
Lieu — Yea
Logue — Yea
Mendoza — Yea
Miller — Yea
Monning — Yea
Nestande — Yea
Norby — Not Voting
Silva — Yea
Skinner — Yea
Solorio — Yea
Torlakson — Yea
Torres — Yea
Tran — Not Voting
Villines — Yea
Adams — Not Voting
Ammiano — Yea
Bass — Yea
Block — Not Voting
Blumenfield — Yea
Bradford — Yea
Brownley — Yea
Buchanan — Yea
Hayashi — Yea
Huber — Yea
Ma — Yea
Nava — Yea
Nielsen — Yea
Ruskin — Not Voting
Smyth — Yea
Swanson — Yea
Torrico — Not Voting
Emmerson — Yea
Eng — Yea
Evans — Not Voting
DeVore — Not Voting
Yamada — Yea
Fuller — Yea
Garrick — Yea
Beth Gaines — Yea
Bill Berryhill — Yea
Bill Berryhill — Yea
Arambula, Joaquin Democratic Yea
Caballero, Anna M. Democratic Yea
Calderon, Lisa Democratic Yea
Jones, Brian W. Republican Not Voting
Niello, Roger W. Republican Yea
Strickland, Tony Republican Yea

Official roll call →

Do pass, to Consent Calendar.

Passed 13 Yea · 0 Nay
Party YeaNayPresentNot Voting
Unaffiliated 10000
Democratic 2000
Republican 1000
Total 13000
% of votes cast 100%0%0%0%
How each member voted (13)
Member Party Vote
Carter — Yea
Charles — Yea
Salas — Yea
Hagman — Yea
Hayashi — Yea
Anderson — Yea
Solorio — Yea
Blakeslee — Yea
Torres — Yea
Feuer — Yea
Caballero, Anna M. Democratic Yea
Calderon, Lisa Democratic Yea
Niello, Roger W. Republican Yea

Official roll call →

Subjects

finance health-insurance
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Frequently asked questions

What does AB 1708 do?
Existing law limits the ability of a surplus line broker to place any coverage with a nonadmitted insurer, as specified. In order for a nonadmitted insurer to qualify for coverage it must demonstrate financial stability, as defined. Existing law defines financial stability to include, but not be limited to, having a total of capital and surplus of at least $15,000,000 with the type of assets to be used in calculating capital and surplus being at least $15,000,000 in the form of cash, securities of a specified character, or in readily marketable securities, as defined. This bill would instead require the total capital and surplus requirement be at least $45,000,000 and the amount of assets to be used in calculating capital and surplus that consist of cash and those other specified types of securities to be at least $25,000,000. The bill would provide that if a nonadmitted insurer on the list of eligible surplus line insurers does not meet the capital and surplus requirements as of January 1, 2011, that insurer would be required to have at least $30,000,000 of capital and surplus as of December 31, 2011, and at least $45,000,000 of capital and surplus as of December 31, 2013. Existing law also defines financial stability, in the case of an Insurance Exchange created and authorized under the laws of individual states, as maintaining capital and surplus of not less than $50,000,000 in the aggregate, with the type of assets to be used in calculating capital and surplus being at least $15,000,000 in the form of cash, securities of a specified character, or in readily marketable securities. In the case of an Insurance Exchange that maintains funds for the protection of all Insurance Exchange policyholders, each individual syndicate seeking to accept surplus line placements of risks resident, located, or to be performed in this state are required to maintain minimum capital and surplus of not less than $6,400,000. Each individual syndicate is required to increase the capital and surplus required by $1,000,000 each year until it attains a capital and surplus of $15,000,000. In the case of Insurance Exchanges that do not maintain funds for the protection of all Insurance Exchange policyholders, each individual syndicate seeking to accept surplus line placement of risks resident, located, or to be performed in this state are required to meet the specified capital and surplus requirements applicable to nonadmitted insurers of at least $15,000,000 with the type of assets to be used in calculating capital and surplus being at least $15,000,000 of that in the form of cash, securities of a specified character, or in readily marketable securities. This bill would instead require the amount of assets to be used in calculating capital and surplus to be at least $25,000,000 in the form of cash, securities of a specified character, or in readily marketable securities. The bill would repeal the minimum capital and surplus requirement formula for an individual syndicate with regard to an Insurance Exchange that maintains funds for the protection of all Insurance Exchange policyholders, and would instead require each syndicate to maintain capital and surplus of not less than $45,000,000. The bill would also raise the capital and surplus requirements regarding each syndicate of Insurance Exchanges that do not maintain funds for the protection of all Insurance Exchange policyholders to $45,000,000. The bill would make conforming changes. The bill would incorporate additional changes to Section 1765.1 of the Insurance Code, proposed by AB 1837 of the 2009–10 Regular Session, to be operative only if both bills are chaptered and become effective on or before January 1, 2011, and this bill is chaptered last.
Who sponsors AB 1708?
AB 1708 is sponsored by Villines.
What is the current status of AB 1708?
This bill has been enacted into law. Introduced February 01, 2010. Enacted.
Where can I track AB 1708?
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