Restitution Bill Rears Its Head Again


As you may recall, the insurance industry was successful in stalling SB 631 (Evans), relative to restitution, in the last legislative session.  Over the recess, the sponsors of the bill, the Department of Insurance, contacted insurance industry representatives over the recess inquiring about a possible fix for the bill.

Last year’s bill, SB 631 would have given the Office of the Insurance Commissioner a new, broad authority to order restitution as part of any non-Proposition 103 enforcement action to compensate a consumer for economic harm arising directly from a violation of insurance law.

Since the Department inquired about fixes over the recess, it was apparent the bill would be introduced again.  This year, the vehicle for this measure is SB 1172 by Senator Ted Lieu (D-Torrance).  It is currently in the form of a “spot bill,” but will later be amended into a more substantial proposal.

The hope is that the insurance industry and the Department can find some middle ground in this debate.