The proposed changes under AB 2202 would reinforce protections for homeowners operating family daycare services by limiting the conditions under which their insurance policies can be canceled or not renewed. If passed, this bill would ensure that homeowners who utilize their residences for daycare services will continue to have access to homeowners insurance without fear of unwarranted cancellation strictly due to their licensed activity, thereby promoting stability for these businesses.
Summary
Assembly Bill No. 2202, introduced by Assembly Member Calderon, seeks to amend Section 676.1 of the California Insurance Code concerning homeowners insurance policies. This bill specifically addresses the arbitrary cancellation or refusal to renew a homeowner's insurance policy based solely on the policyholder's license to operate a family daycare home at their insured location. Under current law, such actions can lead to administrative sanctions against insurers unless certain exceptions apply. AB 2202 aims to update and clarify these provisions without altering the substantive law.
Contention
While AB 2202 is largely technical in nature, it may spark discussions regarding the balance of public policy and the insurance industry's role in regulating coverage for residential properties used for childcare. Potential points of contention could arise from insurance providers who may view the restrictions as limiting their ability to assess risks associated with family daycare services. This bill may face scrutiny from both consumer protection advocates and insurance industry representatives as they weigh the interests of covering vital family services against the insurance providers' need for risk management.