New state laws aim to stop fraud and increase access to insurance

On January 1, 2023, a number of new laws went into effect, including some that hope to expand access to insurance and tackle insurance-related fraud. If you’ve ever tried to insure your home against natural disasters, or you’ve been called about extending your car’s warranty, this can help.

Natural disaster insurance is difficult to obtain for some homeowners in the state. This is why several programs have been proposed to try and increase access. This law allows for the creation of climate resilient areas across the state.

The California Department of Insurance (CDI) says these counties can “help communities reduce their pre-disaster risk and promote recovery.” Each county will be able to carry out projects to protect communities by reducing the risk of natural disasters in the hope of expanding access to insurance.

Another law could help people who may have bought insurance they don’t need or that turned out to be counterfeit. SB 1040 authorizes the Commissioner of Insurance to order reimbursement from people who have sold insurance without the required licenses from the state. This includes so-called “extended vehicle warranties” that are illegally sold over the phone.

In July, NBC 7 Responds told you how an insurance agent was accused of stealing tens of thousands of dollars from a client. Since then, CDI has filed other allegations against a number of other agents in the state.

This new law is trying to help fight fraud. SB 1242 clarifies the anti-fraud training requirements for agents and brokers. It also explains how suspected fraud should be reported to CDI.

These three laws are just some of the new ones aimed at protecting Californians from insurance-related problems. You can find out more on the CDI website here.

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