Cal. Code Regs. tit. 10 § 2645.9

Current through Register 2024 Notice Reg. No. 15, April 12, 2024

Section 2645.9 - Amount of Refund

(a) "Statutory percentage" means the larger of

(1)

(A)

(i) total 1989 direct premium earned, excluding surety, credit, and financial guaranty insurance,

(ii) minus total 1989 direct premium earned, excluding surety, credit, and financial guaranty insurance, adjusted to be on the rate level of November 8, 1987, multiplied by 0.8,

(B) divided by total 1989 direct premium earned, excluding surety, credit, and financial guaranty insurance, or

(2) zero.

(b) "Constitutional percentage" means the larger of

(1)

(A)

(i) total 1989 direct premium earned, including surety, credit, and financial guaranty insurance,

(ii) minus the minimum permitted earned premium, including surety, credit, and financial guaranty insurance,

(B) divided by total 1989 direct premium earned, excluding surety, credit, and financial guaranty insurance, or

(2) zero.

(c) "Refund percentage" means the lesser of the statutory percentage and the constitutional percentage.

(d) For purposes of determining the insurer's rollback obligation, policyholder dividends paid during calendar year 1989 by the insurer shall be treated as follows:

(1) as a refund of premium to the extent that they do not exceed the average dividend, computed as a percent of earned premium, paid in calendar years 1986 through 1988;

(2) as a voluntary rollback and a credit against the rollback obligation owed to consumers who received the dividend to the extent that the dividends exceed the amount specified in subparagraph (1), above.

(e) Each person from whom premiums were collected for policies issued or renewed during the rollback period for coverages other than surety, credit, or financial guaranty insurance shall receive the amount equal to the premiums paid on such policies multiplied by the refund percentage. To this amount shall be added interest, calculated at 10% per annum, from May 8, 1989, to the date of payment.

(f) Every insurer ordered to make a rollback refund shall, on the first three anniversaries of the date of the order, file a report with the Department of Insurance showing the status of the refund payments.

(g) The Commissioner shall require the insurer to file periodic reports establishing its diligent efforts to deliver the refund to each person entitled to a refund before the refund becomes subject to the Unclaimed Property Law, Code of Civil Procedure section 1500 et seq. The Commissioner shall require that the periodic reports be filed quarterly unless the Commissioner finds that more frequent reports are necessary to ensure compliance.

Cal. Code Regs. Tit. 10, § 2645.9

1. New section filed 8-13-91 as an emergency; operative 8-13-91 (Register 92, No. 3). A Certificate of Compliance must be transmitted to OAL 12-11-91 or emergency language will be repealed by operation of law on the following day.
2. Repealed by operation of Government Code section 11346.1(g) (Register 92, No. 15).
3. New section refiled 2-14-92 as an emergency; operative 2-14-92 (Register 92, No. 15). A Certificate of Compliance must be transmittted to OAL 6-15-92 or emergency language will be repealed by operation of law on the following day.
4. Repealed by operation of Government Code section 11346.1(g) and new section filed 3-15-95; operative 3-15-95. Submitted to OAL for printing only pursuant to Government Code section 11343(a)(1) (Register 95, No. 11).

Note: Authority cited: Sections 1861.01, 1861.05, 1861.135, 1861.137 and 12120 of the Insurance Code; 20th Century v. Garamendi, 8 Cal.4th 216 (1994). Reference: Sections 1861.01 and 1861.05, Insurance Code; section 1500 et seq. of the Code of Civil Procedure; Calfarm Insurance Company v. Deukmejian (1989) 48 Cal.3d 805.