California Assembly Bill AB2547

California 2025-2026 Regular Session

• Introduced: 2/20/26

Caption

Life and disability insurance.

Impact

The principal effect of AB 2547 is to maintain the current legal framework governing life and disability insurance in California, with minor technical changes for clarity. By ensuring that insurers can confidently rely on applicants' good faith representations, the bill seeks to stabilize the understanding of legal liability in cases of untrue statements. This could potentially lead to an increase in trust between insurers and applicants, as it reinforces the expectation that insurance applications should be conducted transparently and truthfully.

Summary

Assembly Bill No. 2547, introduced by Assembly Member Harabedian, aims to amend Section 10110.2 of the California Insurance Code, particularly concerning regulations around life and disability insurance. The bill emphasizes the insurer's reliance on the statements made by applicants for insurance regarding their insurable interest in the insured individual. This proposed amendment predominantly focuses on clarifying the existing language of the law, ensuring that insurers can rely on the representations made by applicants during the insurance application process.

Contention

While the bill mainly consists of technical amendments, some stakeholders may raise concerns about the nuances of relying on applicant statements, particularly around what constitutes an 'untrue statement.' There could be debates regarding how this reliance affects consumer protections, especially for those who might feel disadvantaged or misled during the insurance application process. Critics may argue that ambiguous language could still create loopholes where insurers might exploit such provisions to deny claims, despite the intentions of the amendment.