Insurance transactions: notice: electronic transmission.
By removing these restrictions, AB1065 allows insurers to provide required communications to policyholders electronically, assuming that proper consent protocols are followed. This change is expected to streamline communication practices for insurers and improve efficiency in the delivery of essential documents. Additionally, the bill mandates that insurers demonstrate compliance with delivery proof requirements, thus upholding consumer protections even as electronic communications take precedence.
Assembly Bill No. 1065, introduced by Assemblymember Berman, aims to amend and repeal sections of the Civil Code and the Insurance Code related to insurance transactions and the electronic transmission of notices. The bill effectively eliminates a sunset provision that would have restricted electronic notice provisions to a temporary status, thereby allowing electronic records and signatures related to insurance transactions to maintain legal validity indefinitely. This includes notices of cancellation, expiration, and replacement of insurance policies, which were previously exempted from being transmitted electronically under specific conditions.
The general sentiment surrounding the bill appears to be positive among proponents who argue that it modernizes insurance communication and provides flexibility to both insurers and consumers. However, there is some concern regarding consumer understanding and consent related to electronic communications. Stakeholders in the insurance industry generally support this bill as it aligns with evolving technology and business practices, while still ensuring that consumer rights are recognized.
Notable points of contention may arise regarding the implications for consumer protection—particularly how insurers will obtain and document consent before sending electronic communications. Critics may argue that reliance on electronic communication could lead to gaps in notice delivery or comprehension, especially for less tech-savvy individuals. The effective enforcement of compliance and penalties for violations will also be crucial, as these aspects ensure that insurers are held accountable for maintaining standards in their electronic transactions.