BILL NUMBER: AB 802	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Duvall

                        FEBRUARY 26, 2009

   An act to amend Section 758.5 of the Insurance Code, relating to
motor vehicle insurance.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 802, as introduced, Duvall. Motor vehicle insurance: direct
repair programs.
   Existing law prohibits insurers from requiring that an automobile
be repaired at a specific automotive repair dealer. Under existing
law, an insurer may suggest or recommend a specific automotive repair
dealer under certain specified circumstances.
   This bill would state that nothing in that provision prohibits an
insurer from providing a claimant with information regarding the
benefits available to the claimant under the terms of the automobile
insurance policy.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 758.5 of the Insurance Code is amended to read:

   758.5.  (a) No insurer shall require that an automobile be
repaired at a specific automotive repair dealer, as defined in
Section 9880.1 of the Business and Professions Code.  Nothing in
this section prohibits an insurer from providing a claimant with
information regarding the benefits available to the claimant under
the terms of the automobile insurance policy. 
   (b) (1) No insurer shall suggest or recommend that an automobile
be repaired at a specific automotive repair dealer unless either of
the following applies:
   (A) A referral is expressly requested by the claimant.
   (B) The claimant has been informed in writing of the right to
select the automotive repair dealer.
   (2) If the recommendation is accepted by the claimant, the insurer
shall cause the damaged vehicle to be restored to its condition
prior to the loss at no additional cost to the claimant other than as
stated in the policy or as is otherwise allowed by law. If the
recommendation of an automotive repair dealer is done orally, and if
the oral recommendation is accepted by the claimant, the insurer
shall provide the information contained in this paragraph, as noted
in the statement below, to the claimant at the time the
recommendation is made. The insurer shall send the written notice
required by this paragraph within five calendar days from the oral
recommendation. The written notice required by this paragraph shall
include the following statement plainly printed in no less than
10-point type:

"WE ARE PROHIBITED BY LAW FROM REQUIRING THAT REPAIRS BE DONE AT A
SPECIFIC AUTOMOTIVE REPAIR DEALER. YOU ARE ENTITLED TO SELECT THE
AUTO BODY REPAIR SHOP TO REPAIR DAMAGE COVERED BY US. WE HAVE
RECOMMENDED AN AUTOMOTIVE REPAIR DEALER THAT WILL REPAIR YOUR DAMAGED
VEHICLE. IF YOU AGREE TO USE OUR RECOMMENDED AUTOMOTIVE REPAIR
DEALER, WE WILL CAUSE THE DAMAGED VEHICLE TO BE RESTORED TO ITS
CONDITION PRIOR TO THE LOSS AT NO ADDITIONAL COST TO YOU OTHER THAN
AS STATED IN THE INSURANCE POLICY OR AS OTHERWISE ALLOWED BY LAW. IF
YOU EXPERIENCE A PROBLEM WITH THE REPAIR OF YOUR VEHICLE, PLEASE
CONTACT US IMMEDIATELY FOR ASSISTANCE."

   (c) Except as provided in subparagraph (A) of paragraph (1) of
subdivision (b), after the claimant has chosen an automotive repair
dealer, the insurer shall not suggest or recommend that the claimant
select a different automotive repair dealer.
   (d) Any insurer that, by the insurance contract, suggests or
recommends that an automobile be repaired at a particular automotive
repair dealer shall also do both of the following:
   (1) Prominently disclose the contractual provision in writing to
the insured at the time the insurance is applied for and at the time
the claim is acknowledged by the insurer.
   (2) If the claimant elects to have the vehicle repaired at the
shop of his or her choice, the insurer shall not limit or discount
the reasonable repair costs based on charges that would have been
incurred had the vehicle been repaired by the insurer's chosen shop.
   (e) For purposes of this section, "claimant" means a first-party
claimant or insured, or a third-party claimant who asserts a right of
recovery for automotive repairs under an insurance policy.
   (f) The powers of the commissioner to enforce this section shall
include those granted in Article 6.5 (commencing with Section 790) of
Chapter 1 of Part 2 of Division 1.