California Insurance Code 1216.5 – (a) (1) If the commissioner believes that the controlling …
(a) (1) If the commissioner believes that the controlling producer or any other person has not materially complied with this article, or any regulation or order issued or promulgated pursuant to this article, and after notice and an opportunity to be heard, the commissioner may order the controlling producer to cease placing business with the controlled insurer.
(2) If the commissioner finds that because of any material noncompliance that the controlled insurer or any policyholder thereof has suffered any loss or damage, the commissioner may bring a civil action or intervene in an action brought by or on behalf of the insurer or policyholder for recovery of compensatory damages for the benefit of the insurer or policyholder or other appropriate relief.
Terms Used In California Insurance Code 1216.5
- Commissioner: means the Insurance Commissioner of this State. See California Insurance Code 20
- controlled: has the meaning ascribed in Section 1215. See California Insurance Code 1216.1
- Controlled insurer: means an admitted insurer which is controlled, directly or indirectly, by a producer. See California Insurance Code 1216.1
- Controlling producer: means a producer who, directly or indirectly, controls an insurer. See California Insurance Code 1216.1
- Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
- insurer: means any person, firm, association, or corporation admitted to transact any property or casualty insurance business in this state. See California Insurance Code 1216.1
- Person: means any person, association, organization, partnership, business trust, limited liability company, or corporation. See California Insurance Code 19
- Producer: means a fire and casualty licensee or licensees or any other person, firm, association, or corporation, when, for any compensation, commission, or other thing of value, the person, firm, association, or corporation acts or aids in any manner in soliciting, negotiating, or procuring the making of any insurance contract on behalf of an insured other than the person, firm, association, or corporation. See California Insurance Code 1216.1
(3) Nothing in paragraph (1) shall be construed to limit any authority granted to the commissioner by any other provision of law to issue orders or take actions prior to the holding of a hearing.
(b) If an order for liquidation or rehabilitation of the controlled insurer has been entered pursuant to Article 14 (commencing with Section 1010) of Chapter 1 of Part 2 of Division 1, and the receiver appointed under that order believes that the controlling producer or any other person has not materially complied with this article, or any regulation or order issued or promulgated pursuant to this article, and the insurer suffered any loss or damage therefrom, the receiver may maintain a civil action for recovery of damages or other appropriate sanctions for the benefit of the insurer.
(c) Nothing contained in this section shall affect the right of the commissioner to impose any other penalties authorized by any other provision of law.
(d) Nothing contained in this section is intended to or shall in any manner limit or diminish the rights of policyholders, claimants, creditors, or other third parties.
(Added by Stats. 1992, Ch. 614, Sec. 7. Effective January 1, 1993.)