Calif. Watchdog Bill on Hold

Assembly Bill 1738, the bill to form a consumer “watchdog” association for the insurance industry, didn’t get too far in the California Senate Appropriations Committee this week. The bill was placed in the “suspense file” on May 15 for further examination of its potential fiscal impact.

AB 1738 calls for a special consumer association to participate in insurance regulatory hearings and advocate public policy positions. Insurers would be required to send a membership application to policyholders in all mailings of applications, notices of coverage and billing statements.

The committee is currently investigating how much it will cost to include information about the association in mailings from the Department of Motor Vehicles.

Industry groups such as the National Association of Independent Insurers (NAII) oppose AB 1738, calling it “unnecessary” and “costly to implement,” maintaining that “[it] singles out the insurance industry for special treatment.”