Brown Signs Insurance Bill to Clarify Bond Requirements

California Gov. Jerry Brown has signed a bill that makes several changes to various state insurance code sections regarding agent licensing and training, administrative processes and previously enacted legislation.

Assembly Bill 1416, which received unanimous in the state Legislature and from Insurance Commissioner Dave Jones, will enhance the state insurance department’s operational efficiencies and enable staff to focus on critical issues relating to consumer protection, according to Jones.

AB 1416 also makes several changes in the law relating to insurance producer licenses, including clarifying the bond requirement for an agent or broker who holds both property and casualty licenses. Legislation enacted last year that created the two license types was unclear on the bonding requirements and could be interpreted that a separate bond was required for each license.

AB 1416 also permits the Insurance Commissioner to remove a life agent’s authority to transact variable life insurance contracts upon learning that the agent is no longer registered to transact securities with the U.S. Securities and Exchange Commission or the Financial Industry Regulatory Authority.

“I am very pleased to have this new authority,” Jones said in a statement.

AB 1416 takes effect Jan. 1.