BILL ANALYSIS                                                                                                                                                                                                    



          SENATE COMMITTEE ON INSURANCE
                             Senator Richard Roth, Chair
                                2015 - 2016  Regular 

          Bill No:              AB 764        Hearing Date:    July 8,  
          2015
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          |Author:    |Quirk                                                |
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          |Version:   |June 29, 2015    Amended                             |
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          |Urgency:   |No                     |Fiscal:    |Yes              |
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          |Consultant:|Erin Ryan                                            |
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                 Subject:  Parking lots: design: insurance discount.


           SUMMARY     Requires the California Building Standards Commission (CBSC),  
          in collaboration with the State Architect and the State Fire  
          Marshall, to consider standards, at each model code adoption  
          review, for installation of vehicle barriers in the design of  
          any new building; defines a vehicle barrier for this purpose;  
          and allows an insurer to consider the installation of a vehicle  
          barrier as a safety measure and provide or offer a discount on  
          the property insurance of a commercial property owner who  
          installs such a vehicle safety barrier, if actuarially sound and  
          approved by the Insurance Commissioner (IC), as specified.
          
           
          DIGEST
            
          Existing law
            
           1)  Establishes the CBSC within the Department of General Services,  
              and requires any building standards adopted or proposed by state  
              agencies to be submitted to, and approved by, the CBSC prior to  
              codification into the California Standards Code.

           2)  Requires the CBSC to adopt, approve, codify and publish  
              building standards providing the minimum standards for the  
              design and construction of state buildings, as specified.

           3)  Requires specified insurance rates to be approved by the IC  
              prior to their use under the Insurance Rate Reduction and Reform  







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              Act (Proposition 103, as approved by the voters in 1988) (Prop.  
              103).

           

          This bill

            1)  Requires the CBSC, in collaboration with the State  
              Architect and the State Fire Marshall, to consider  
              standards, at each model code adoption review, for  
              installation of vehicle barriers in the design of any new  
              building.

           2)  Defines a vehicle barrier to include a horizontal or  
              vertical protective device placed to protect persons located  
              within, or in or on the property of, buildings, or to  
              protect pedestrians from collisions by motor vehicles.

           3)  Specifies an insurer may consider the installation of a  
              vehicle barrier as a safety measure, and may provide or  
              offer a discount on the property insurance of a commercial  
              property owner who installs such a vehicle safety barrier.

           4)  Requires any discount to be actuarially sound and approved  
              by the IC consistent with the requirements of Prop. 103. 


           COMMENTS
            
          1.  Purpose of the bill    To reduce storefront crashes by  
              encouraging the adoption of protective barrier standards,  
              particularly in commercial buildings, which have been slower  
              to install vehicle barriers than other types of properties.  
              It would also allow an insurer to consider these barriers as  
              a safety measure and seek to offer discounts on insurance  
              for commercial properties that install such barriers. 


           2.  Background    According to the author, vehicle-into-building  
              crashes have been reported to occur as many as 60 times per  
              day, with more than 3,600 pedestrians, store patrons, and  
              employees seriously injured each year, nationwide.   
              Sometimes called "storefront crashes," these accidents are  
              often caused by driver error.  Most of these accidents can  








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              be prevented with simple and inexpensive steps, including  
              the installation of vehicle barriers that can be taken in  
              either the design phase or as part of a retrofit.  

              According to the Texas A&M Transportation Institute (TTI),  
              "With 500 people reportedly killed each year by vehicles  
              crashing into retail stores, sidewalk cafes, hair salons and  
              other businesses, low speed barrier crashes have been called  
              'one of the largest unaddressed safety issues in the  
              country.'"  According to TTI, these accidents occur most  
              frequently when a driver is entering or leaving a parking  
              space perpendicular to a building, and even at relatively  
              low speeds, can cause serious injury or death.  TTI notes,  
              however, that simple, preventative measures can protect  
              pedestrians, store employees, and patrons from being injured  
              or killed when the accidents occur.  In recognition of the  
              safety risks posed by errant vehicles and the increasingly  
              important use of protective barriers as a way to prevent or  
              minimize the damages from these types of accidents, the  
              American Society for Testing and Materials International, an  
              international standards development organization, in  
              conjunction with the researchers at TTI, recently approved a  
              test standard, known as the Test Method for Low Speed  
              Barriers for Errant Vehicles, to set parameters for  
              bollards, barriers, and other devices most often seen  
              protecting storefronts and high-traffic pedestrian areas to  
              help standardize the use of protective barriers.  Prior to  
              the adoption of this standard, there was no objective way to  
              evaluate the effectiveness of vertical pipes, decorative  
              planters, and other devices that could serve to protect a  
              business from damages caused by a vehicle-into-building  
              collision.

              Although this bill draws attention to the safety aspects of  
              vehicle barriers, insurers already consider the condition  
              and safety features of a commercial property when writing a  
              commercial insurance policy.  Prop. 103, however, generally  
              requires historical loss-based actuarial data to justify a  
              discount in insurance premiums paid by an insured. The  
              development of standards and ability to evaluate barrier  
              effectiveness provided by this bill may make it easier for  
              insurers to assess the extent to which their risk and  
              exposure is reduced as a result of the installation of such  
              barriers, and provide an actuarial justification in a rate  








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              filing subject to IC prior approval before a discount  
              specific to vehicle barriers could be offered.   


           3.  Support   The Storefront Safety Council supports AB 764 and  
              the authorization of safety barriers as a design  
              consideration, and the added benefit of insurance premium  
              relief as a reward for this positive safety effort.   
              Farrell's Ice Cream Parlour Restaurants supports AB 764  
              because of its own experience with a vehicle crashing into  
              one of its restaurants, causing one death and several severe  
              injuries to young children. According to the CEO, "the  
              carnage is something I hope other business owners never have  
              to go through. But they will unless our State takes a step  
              to fix a problem that has just evolved due to the changing  
              age of our population who are still driving, and changes to  
              parking design to accommodate the ADA?store front crash  
              deaths are easily preventable."

           4.  Opposition   None received

           
          POSITIONS
            
          Support
           
          California Restaurant Association
          Farrell's Ice Cream Parlour restaurants
          Storefront Safety Council  

          Oppose
               
          None received

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