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The following regulatory information may be of interest to attorneys practicing insurance law. This information is current as of February 14, 2023.

Motor Vehicle Financial Responsibility Requirements

On January 30, 2023, the CDI issued Bulletin 2023-1 titled “Increase in Private Passenger Motor Vehicle Financial Responsibility Requirements — Senate Bill 1107” reminding insurers writing automobile liability insurance to make rate filings by July 1, 2023 in order to update their rates to reflect the increase in minimum liability coverage to $30,000 effective January 1, 2025. The increase is a result of the passage of SB 1107, which the CDI supported. The obligation to file updated rates is also included in SB 1107. Insurers are instructed to make a “Rule filing without rate impact,” for program name “FR Limits 2023” that only adds the limit options required by SB 1107. Any other desired changes should be made in a separate filing. The Bulletin also addresses, but does not resolve, the application of the new limits requirements.

Wildfire Mitigation in Rating Plans

On February 3, 2023, the CDI issued Bulletin 2032-2, titled “Prior Approval Rate Application Requirements to Comply with Title 10 of the California Code of Regulations, Section 2644.9(d)” relating to prior approval rate filing requirements that insurers are required to make in connection with implementation of the new Safer from Wildfires regulations and reminding insurers of their obligations under those regulations. Notably, by April 12, 2023, insurance companies are required to establish a process for releasing wildfire risk determinations to homeowners and businesses and create a right for appeal of that determination. The rate filing implementing the new regulations must be revenue neutral and address only the changes relating to the regulation; other desired changes must be in a separate filing. The filing should be made as a “Rule filing without rate impact,” and identify the program name as “Mitigation in Rating Plans Regulation.” The Bulletin provides detail regarding the documents and information to be included in the filing.

Mudslide Notice

On January 4, 2034, the CDI published a notice titled “Coverage of Flood, Mudslide, and Earth Movement Claims Relating to Recent Wildfires” reminding insurers that under the efficient proximate cause doctrine mudslide losses may be covered under fire policies if fire was the efficient proximate cause of the mudslide loss.

This e-Bulletin was prepared by Nicole Zayac, Counsel in the San Francisco office of Willkie Farr & Gallagher LLP ( Ms. Zayac is a member of the Executive Committee of the California Lawyers Association Business Law Section and is the current Liaison to and past Chair of the Insurance Law Standing Committee.

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