IIABCal Blocks Restitution Authority By Commissioner

Last week, the state Senate Insurance Committee blocked a bill that would have provided the insurance commissioner the unprecedented authority to order restitution.

Sponsored by Insurance Commissioner Dave Jones, SB 631 would have given the  commissioner the authority to order restitution as a result of a licensee violating the Insurance Code or department regulations. Restitution Under provisions of the bill was defined as any out of pocket damages incurred by the consumer, attorneys fees and court costs, cost of any CDI investigation and all future enforcement costs incurred by the department of insurance.

"This was one of the most dangerous bills facing producers that we have seen in the legislature for the last few years,"  said IBA West Legal Counsel John Norwood. "In an administrative action by the Department of Insurance, the commissioner is judge, jury and prosecutor. Insurance producers simply do not have the resources or the same due process rights to fight this type an action by the regulator."

Click HERE to view the Advocacy Alert sent to members earlier this week.