BILL ANALYSIS
SENATE COMMITTEE ON INSURANCE
Senator Jackie Speier, Chair
AB 600 (Knox and Villaraigosa)Hearing Date: June 30,
As Amended: June 17, 1999
Fiscal: Yes
Urgency: Yes
Assembly Insurance Committee - 4/14/99 - (12-0)
Assembly Floor - 6/3/99 - (79-0)
SUMMARY
Would require the Insurance Commissioner to establish and
maintain the Holocaust Insurance Registry, would require
insurers to provide specified information regarding
insurance policies to be included in the registry, would
provide public access to the registry in connection with
claims litigation, and would provide penalties for an
insurers failure to comply with reporting requirements.
DIGEST
Existing law
1. Provides for the Insurance Commissioner's regulation
of insurers licensed and transacting the business of
insurance in this state.
2. Authorizes the Insurance Commissioner to suspend or
revoke the certificate of authority of an insure for
failure to comply with laws governing insurance
regulation in this state.
3. Requires the Department of Insurance to conduct
research and investigation into insurance policies,
unpaid insurance claims and related matters of victims
of the Holocaust.
4. Requires the Insurance Commissioner to suspend the
Certificate of Authority of an insurer if the insurer
or any affiliate of the insurer has failed to pay any
valid claim of Holocaust survivors, until the claim is
paid by the insurer or its affiliate.
AB 600, Page
2
5. Authorizes legal actions on Holocaust insurance claims
arising out of insurance policies issued in Europe
between 1920 and 1945.
This bill
1. Would require the Insurance Commissioner to establish
and maintain a registry accessible to the public of
information related to the insurance policies of
Holocaust victims.
2. Would require any insurer doing business in California
that sold insurance in Europe that was effected between
1920 and 1945, whether directly or through a related
company, to file with the Insurance Commissioner
specific information related to the policies sold.
3. Would require each insurer subject to the provisions
of the bill to certify to the appropriate following
facts regarding insurance policies:
a. That the proceeds of the policies have been
paid to the designated beneficiaries or heirs;
b. That where beneficiaries or heirs could not
be located, that the proceeds have been
distributed to Holocaust survivors or to
qualified charitable nonprofit organizations for
the purpose of assisting Holocaust survivors;
c. That a court has certified a plan for the
distribution of the proceeds; or
d. That proceeds of a designated amount have
not been distributed.
4. Would establish a misdemeanor penalty for an insurer's
knowingly false certification.
5. Would establish a civil penalty of up to $5,000 for
each instance an insurer knowingly files false
information related to the reporting requirements of
the bill.
6. Would require the Insurance Commissioner to suspend
AB 600, Page
3
the Certificate of Authority of an insurer that fails
to comply with the reporting requirements of the bill
by the 210th day after the effective date of the
requirements.
7. Would require the Insurance Commissioner to adopt
emergency regulations to implement the measure within
90 days of the effective date of the bill.
8. Would authorize legal actions on Holocaust insurance
claims arising out of insurance policies purchased or
in effect in Europe before 1945.
9. Would provide for the adoption of the above provisions
on an urgency basis.
COMMENTS
1. Purpose of the bill . The author introduced this bill
in order to ensure that Holocaust victims or their
heirs can take direct action on their own behalf with
regard to insurance policies and claims. The bill sets
up a registry of information, without which the only
remaining evidence of insurance policies purchased
prior to the end of W.W.II would be in the hands of the
insurance companies or Department of Insurance. The
bill will help resolve this outstanding issue by
ensuring that any existing information on insurance
policies purchased prior to the end of W.W.II will be
available to those individuals who need that
information in order to protect their rightful claims
to reimbursement from insurers.
2. Background . The issue of insurance claims for
Holocaust survivors came to light in 1997 through a
class action suit filed in New York. The problem of
unpaid insurance claims had been discovered in the
course of researching Holocaust survivor claims to
European bank deposits. DOI estimates there are 50,000
to 100,000 Holocaust survivors in the United States.
California has the second largest number, ranging from
6,300 to 19,000. In 1998, two bills were introduced
relating to the recovery of proceeds from unpaid
Holocaust victim claims. The Governor vetoed AB 1715
(Knox), which contained similar provisions to this
bill. The Governor signed SB 1530 (Hayden), Chapter
AB 600, Page
4
963, which required the Department of Insurance to
develop a plan to investigate and recover unpaid
Holocaust victim insurance claims and provided for the
suspension of the certificate of authority of insurers
failing to pay valid claims.
3. Support . Supporters argue that this bill is an
important measure to assist Holocaust survivors and
their heirs to obtain their rightful compensation. The
Department of Insurance notes that insurance companies,
that have for over 50 years refused to pay Jewish and
other policyholders, should be held accountable, open
their books and pay legitimate claims. The Department
believes this bill will be of significant assistance to
the Department in its endeavor to ensure full payment
of claims to Holocaust survivors and their descendants.
The Consumer Federation of California believes this
bill is urgently needed because of the age of the
survivors and that justice demands an affirmative duty
to resolve this matter in a timely fashion.
The Los Angeles County Bar Association supports the
purposes of the bill, such as providing additional
remedies to individuals with unpaid claims, making
information available to claimants, and resolving
important questions about past processing of claims.
The Association however is concerned about the
following "ambiguities and uncertainties": 1) Broad
definitions of "related company" and "Holocaust victim"
that might impose liability on insurers with no true
relationship to the Holocaust, for claims of persons
persecuted in areas other than occupied Europe; 2)
The filing requirements for policies unrelated to
Holocaust victims; and 3) Whether companies can
reasonably comply with the reporting requirements.
4. Opposition . The Alliance of American Insurers opposes
this bill because it places an unfair burden on
subsidiary carriers owned by overseas companies and is
unnecessary because existing law already created the
program to help Holocaust victims.
POSITIONS
Support
AB 600, Page
5
Beverly Hills Bar Association
Department of Insurance
California Alliance for Consumer Protection
City Council of the City of West Hollywood
Consumer Federation of California
Jewish Community Relations Committee of the Jewish
Federation
of Greater Los Angeles (Sponsor)
Jewish Public Affairs Committee of California
Johan Klehs, Chair, State Board of Equalization
Los Angeles County Bar Association (with concerns)
Philip Angelides, State Treasurer
Oppose
Alliance of American Insurers
Consultant: Jerry Whitfield