COVID-19 and CA Department of Insurance – Public Notices

Essential Service Guidance

The United States Department of Homeland Security released guidance on essential critical infrastructure workers March 19th.  Insurance services are listed as essential within the section on financial services.  For more information, the guide is available here: https://www.cisa.gov/identifying-critical-infrastructure-during-covid-19.  California Insurance Commissioner Ricardo Lara issued further guidance on March 20th, that insurance services are included as essential services.  We know many of you are taking important precautions like working remotely, or closing your insurance offices to the public, while still continuing to provide great service to your clients, Commissioner Lara’s bulletin is available here: http://www.insurance.ca.gov/0250-insurers/0300-insurers/0200-bulletins/bulletin-notices-commiss-opinion/upload/CDI-Essential-Services-Notice-Final.pdf.

Commissioner Lara did reiterate the importance of timely processing of payments as people shelter in place and adhere to social distancing guidelines: https://www.insurance.ca.gov/0250-insurers/0300-insurers/0200-bulletins/bulletin-notices-commiss-opinion/upload/Insurance-Laws-COVID-19-Notice-03_18_20_With_Seal_1249pm_Final.pdf

Premium Grace Period

California Insurance Commissioner Ricardo Lara issued a notice on March 18th, requesting insurance companies provide policyholders at least a 60-day grace period on insurance premiums payments during the COVID-19 outbreak.  This move came shortly after the Governor’s State of Emergency declaration to make additional resources available, and formalize emergency actions already underway across multiple state agencies.  Similar moves were taken allowing for a temporary moratorium on evictions and foreclosures by the State and Federal government.  Notice is available here: http://www.insurance.ca.gov/0400-news/0100-press-releases/2020/upload/nr030-BillingGracePeriodNotice03182020.pdf.

Drivers License Renewal Discretion 

On March 18th, California Insurance Commissioner Ricardo Lara issued a bulletin asking insurers not to use drivers license expiration date for the following:

  • To maintain insurance coverage
  • Affect a Good Driver discount
  • Determine eligibility for the California Low Cost Auto policy
  • Impact rates charged to any driver.

Governor Newsom and the California Department of Motor Vehicles have asked law enforcement to use discretion for at least 60 days enforcing drivers license and vehicle registration renewals to reduce the need for individuals to visit their local DMV office.  For additional information, you can view the bulletin here: Notice-Expired drivers licenses, registrations and insurance.

Claims – Insured Deadline Extension / ALE 

On April 3rd, California Insurance Commissioner Ricardo Lara issued a bulletin asking insurers to waive policy or statutory deadlines on policyholders until ninety (90) days after the end of the California state of emergency. This includes deadlines for the submission of a sworn proof of loss, other claim forms, examinations under oath, medical examinations, physical inspections of insured property, separating damaged property from undamaged property, temporary repairs to prevent further damage, and any other policy, statutory, or insurer imposed deadlines placed on the policyholder where failure to comply could result in the forfeiture, limitation, or waiver of any policyholder(s) rights to benefits under any policy of insurance.

The Insurance Commissioner also stated in the bulletin that the COVID-19 pandemic emergency constitutes “good cause” for a 6-month extension of additional living expenses benefits (ALE).

For additional information, you can view the bulletin here: http://www.insurance.ca.gov/0400-news/0100-press-releases/2020/upload/nr035ExtPolicyClaimCOVID04032020.pdf 

Acceptance of E-signatures, E-notarizations; extension of deadline to file financial statements 

On April 6th California Insurance Commissioner Ricardo Lara issued a bulletin providing guidance to insurers as to how to meet filing deadlines by filing electronically, allowing for electronic notarization, and extension of certain statutory deadlines until 90 days after the state of emergency is lifted.

For additional information, you can view the bulletin here: http://www.insurance.ca.gov/0250-insurers/0300-insurers/0200-bulletins/bulletin-notices-commiss-opinion/upload/Notice-of-Compliance-with-Regulatory-Filing-and-Submittal-Requirements.pdf 

Expansion of Delivery Coverage for PPA and Commercial Policies for Essential Businesses 

On April 9th California Insurance Commissioner Ricardo Lara issued a bulletin asking insurers to honor auto insurance claims that may have been filed as a result of commercial activity, such as delivery of food, medication, or other goods. The Insurance Commissioner also requested the following:

  • Insurers add delivery coverage to personal auto policies for drivers engaged in
    delivery service on behalf of a California essential business.
  • Insurers allow California essential businesses to add retroactively additional
    drivers not previously named under such businesses’ commercial automobile
    policy.
  • Insurers allow delivery coverage for drivers who utilize a personal motorcycle
    motor scooter, and/or bicycle to engage in delivery services on behalf of California
    essential businesses under their personal auto policies if such policies already
    include motorcycle coverage for the insured driver.
  • Insurers that provide commercial general liability coverage to California essential
    businesses notify their insureds that commercial automobile coverage is available
    if requested.

The Commissioner requested these coverages be effective until 30 days after the state of emergency is lifted. For more information on the bulletin, click here: http://www.insurance.ca.gov/0250-insurers/0300-insurers/0200-bulletins/bulletin-notices-commiss-opinion/upload/Notice-CoverageDeliveryDrivers.pdf 

Premium Refunds, Credits, and Reductions in Response to COVID-19 Pandemic 

On April 9th California Insurance Commissioner Ricardo Lara issued a bulletin ordering insurers to make an initial premium refund for the months of March and April, and give notice within 120 days of the bulletin, to all adversely impacted California policyholders in the following lines of insurance:

  • Private passenger automobile insurance
  • Commercial automobile insurance
  • Workers’ compensation insurance
  • Commercial multiple peril insurance
  • Commercial liability insurance
  • Medical malpractice insurance
  • Any other line of coverage where the measures of risk have become substantially
    overstated as a result of the pandemic.

The bulletin also requires that insurers submit a report within 60 days of the bulletin that includes California-specific information as well as information related to the refund.

For more information on the bulletin, click here: http://www.insurance.ca.gov/0400-news/0100-press-releases/2020/upload/nr038AutoPremiumRefundsCOVID04132020.pdf 

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