Store Research
Assembly Bill 688 (McAlister – 1981)
Chapter 1131, Statutes of 1981 ab 688
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Numerous sections of the Insurance Code regarding fees were amended or added in 1981 following legislative approval of Assembly Bill 688, introduced on February 26, 1981 by Assembly member Alister McAlister. (See Exhibit #1a and #1i) At this time, Assembly member McAlister served as chair of the Assembly Committee on Finance, Insurance, and Commerce. (See Exhibit #3, page 1) He carried this bill for the Department of Insurance. (See Exhibit #14, document PE-6)
Assembly Bill 688 was assigned to the Assembly Committee on Finance, Insurance, and Commerce and the Senate Committee on Insurance and Indemnity where policy issues raised by the bill were considered. (See Exhibit #3 and #8) The fiscal ramifications of the bill were considered by the Assembly Committee on Ways and Means and the Senate Committee on Finance. (See Exhibit #2 and #5)
Assembly Bill 688 was amended seven times while under legislative consideration. (See Exhibit #1b through #1h and #2) Subsequent to legislative approval, Governor Edmund G. Brown, Jr., signed the bill on October 1st, and it was recorded by the Secretary of State on October 2nd as Chapter 1131 of the Statutes of 1981. (See Exhibit #1i and #2)
The Concurrence in Senate Amendments analysis of Assembly Bill 688 as last amended September 11, 1981 described this measure as follows:
This bill increases the fees and charges imposed upon insurers by the Department of Insurance for various services rendered. It also imposes certain new fees while deleting other fees.
The bill also directs that funds collected by the Department of Insurance will be deposited in the Insurance Fund, rather than being returned to the State General Fund, and shall be used to finance the operations of the department subject to annual appropriation.
(See Exhibit #12, page 1)
The Senate Committee on Insurance and Indemnity analysis of the bill provided the following background discussion:
Existing law requires the imposition of various application fees, examination fees, and other charges upon insurers and licensees for services rendered by the Department of Insurance. All moneys received by the commissioner are required to be deposited in the State Treasury to the credit of the Insurance Fund. Money in the Insurance Fund is appropriated to pay authorized refunds, and the balance of the fund’s money is required to be transferred to the General Fund, upon the order of the Controller.
The Department of Insurance is concerned with its cash flow which arises both because the statutory fees are set too low and because of its dependence upon the General Fund for support.
(See Exhibit #8, pages 1 and 2)