HomeBlogCA Administrative & Licensing Law DefenseInsurance Licensing Backlog Bill Awaits Governor’s Signature

(Reprinted courtesy of Independent Insurance Agents & Brokers of California website)

SACRAMENTO, CA (September 3, 2015) – A bill that attempts to address the backlog of appeal cases involving a denied insurance-related license is now on the Governor’s desk awaiting a signature or veto.

The bill, authored by Assembly Woman Cristina Garcia (D—Bell Gardens), expands the authority of the Insurance Commissioner to assign an administrative law judge to hear appeal cases that are currently administered by the Office of Administrative Hearings (OAH), who is involved in some 1,600 hearings and mediations annually.

Insurance agents are required to acquire a license in order to practice.  In order to become licensed, one must pass a background check and an examination.  However, certain background checks can result in the denial or conditional approval of a license.  In these circumstances, the licensee may appeal the ruling.

As a result of this growing backlog that can take as much as a year for appeals to be heard, AB 1232 would allow an applicant to indicate if he or she would prefer the case to be reviewed by OAH or an administrative law judge (ALJ) appointed by the Insurance Commissioner.

Although the Department of General Services took an oppose position on the bill as it impedes upon the jurisdiction of OAH who is considered an independent and neutral body to hear these matters, and further claims there is no proof relative to the bill reducing the backlog of cases, the insurance industry nonetheless did not taken a position on the bill.

With such limited opposition, the bill sailed through the legislative process and was concurred in by the Assembly this past Tuesday.