The American Agents Alliance and Western Insurance Agents Association, trade association groups consisting of over 1,500 property and casualty insurance agencies called for the Insurance Commissioner to withdraw his proposed regulations, which create new fiduciary duties on insurance producers.
On behalf of the associations, Robert W. Hogeboom of Barger & Wolen, a leading insurance litigation and regulatory law firm, denounce proposed regulations as an improper attempt to circumvent the procedure established in Section 790.06 of the California Insurance Code, which requires the Commissioner to prosecute acts which he believes are unfair and to seek a court order enjoining the act.
Hogeboom explained that there are only two ways to determine an unfair trade practice in the business of insurance, those which are specifically defined in Section 790.03 or if not defined, determined by the administrative hearing procedure coupled with a proceeding initiated by the Attorney General in the superior court.
Hogeboom noted that the Commissioner’s authority to promulgate regulations are limited to his administration of the regulation of trade practices in insurance business, as opposed to creating new practices by regulation.
Topics Legislation
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