Bill Text: CA SB397 | 2009-2010 | Regular Session | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

---

Bill Title: Life insurance.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Vetoed) 2010-01-19 - Stricken from Senate file. [SB397 Detail]

Download: California-2009-SB397-Introduced.html

---

BILL NUMBER: SB 397	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senator Calderon

                        FEBRUARY 26, 2009

   An act to amend Section 10127.7 of, and to add Section 789.15 to,
the Insurance Code, relating to life insurance.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 397, as introduced, Calderon. Life insurance.
   Existing law regulates the sale of life insurance, in particular
sales to seniors, including annuities, as specified.
   This bill would provide that if a senior makes a written or
telephonic request for a meeting the same day to discuss the purchase
of specific life insurance having an initial face amount of $15,000
or less that is designated by the purchaser for payment of funeral
and burial expenses, a notice, as specified, shall be delivered to
the senior prior to the start of the meeting.
   The bill would also provide that the sale of a burial or funeral
policy shall not create an existing insurance relationship for the
purposes of the required delivery of a specified written notice to
seniors 24 hours before meeting in their home to sell other life
insurance.
   Existing law provides that life insurance policies with a face
value of less than $10,000, issued after July 1, 1974, shall contain
a notice permitting the return of the policy within a period of time
designated in the notice, which may not be less than 10 or more than
30 days.
   This bill would provide that a life insurance policy with a face
value of $15,000 or less, issued after January 1, 2010, shall contain
a notice permitting the return of the policy within 45 days.
   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 789.15 is added to the Insurance Code, to read:

   789.15.  If a senior makes a written or telephonic request for a
meeting the same day to discuss the purchase of specific life
insurance having an initial face amount of fifteen thousand dollars
($15,000) or less that is designated by the purchaser for payment of
funeral and burial expenses, a notice as required by subdivision (b)
of Section 789.10 shall be delivered to the senior prior to the start
of the meeting. In addition to the requirements of Section 789.10,
that notice shall contain the following information in at least
14-point type, and be initialed by the senior:
   "You have the right to cancel and return a policy or certificate
within 45 days of receipt for a full refund."
   The notice must be read and signed by the senior and submitted
with any application if the senior purchases a policy. The agent or
insurance representative shall not be permitted to sell any other
lines of insurance that are not policies for funeral or burial
expenses. A sale of a burial or funeral policy under this section
shall not create an existing insurance relationship for purposes of
Section 789.10.
  SEC. 2.  Section 10127.7 of the Insurance Code is amended to read:
   10127.7.  Every policy of individual life insurance with 
a   an initial  face value of  less than
ten thousand dollars ($10,000) which   fifteen thousand
dollars ($15,000) or less that  is delivered or issued for
delivery in this state on and after  July 1, 1974, 
 January 1, 2010,  shall have printed thereon or attached
thereto a notice stating that, after receipt of the policy by the
owner, the policy may be returned by the owner for cancellation by
delivering it or mailing it to the insurer or to the agent through
whom it was purchased. The period of time set forth by the insurer
for return of the policy by the insured shall be clearly stated on
the notice and this period shall be not less than  10 days
nor more than 30   45  days. The insured may return
the policy to the insurer at any time during the period specified in
the notice. This delivery or mailing of the policy by the owner
shall void the policy from the beginning, and the parties shall be in
the same position as if no policy or contract had been issued. All
premiums paid and any policy fee paid for the policy shall be
refunded to the owner.
   This section applies to all policies issued  , amended, or
delivered in this state on or after January 1, 1981, but prior to
January 1, 1990,   on or after January 1, 2010, 
and applies to any renewal thereof. All policies subject to this
section which are in effect on January 1,  1981, 
 2010,  shall be construed to be in compliance with this
section, and any provision in  such  a policy
 which   that  is in conflict with this
section shall be of no force or effect.
   This section does not apply to individual life insurance policies
issued in connection with a credit transaction or issued under a
contractual policy change or conversion privilege provision contained
in a policy.