SB 1209 California Senate · 2025-2026 Regular Session

Insurance: examination of insurers.

Summary

Existing law authorizes the Insurance Commissioner to conduct examinations of insurers whenever they deem it appropriate, or for admitted insurers, at least once every 5 years. Existing law requires the examiner in charge to file a verified written report of the examination with the department. Existing law requires the department to transmit that report to the company examined with a notice that the company has 30 days to make a written submission or rebuttal to any matters contained in the report. Existing law requires the commissioner, within 30 days of the end of the period allowed for the company to reply, to fully consider the report and any submissions and either adopt the report as filed, with modifications, or reject the report with an order to reopen the examination. This bill would require an examined company to take corrective actions to remediate violations of specified laws and regulations identified in the report. The bill would require a company that fails to adopt the necessary corrective actions to be subject to a penalty. The bill would authorize the company to request an additional extension to comply in specified circumstances. The bill would require the commissioner, if the commissioner has reason to believe that a company has not complied with a recommendation in the report, to issue and serve an order to show cause on the company with a statement of the charges, its potential liability, and a notice of hearing. If the charges are found to be justified, the bill would require the commissioner to issue an order requiring the company to pay a specified penalty and to comply with and implement the recommendations contained in the report. The bill would require the hearing be held in compliance with the Administrative Procedure Act and would state that these powers would be additional to any other powers currently vested in the commissioner to enforce the provisions of this code.

Bill status passed both 4 of 5 stages cleared

Introduction

Feb 2026

Committee Review

Aug 2026

Senate Passage

May 2026

Assembly Passage

Aug 2026

Governor

Introduced Feb 19, 2026 Last action Aug 28, 2026

Maddy AI version diff · 3 comparisons

What changed between versions

06/10/26 - Amended Assembly → SB1209 · 1 edit

MINOR

The bill text of SB 1209 is substantively unchanged between the Amended Assembly version and the final Enrolled version. The differences are limited to formatting (removal of line numbers and page headers), addition of website navigation elements, and status updates reflecting that the bill was passed by the Assembly on August 27, 2026, by the Senate on August 28, 2026, and enrolled on August 31, 2026.

TECHNICAL

The bill transitioned from the Amended Assembly version to the final Enrolled version. No substantive policy language was changed. The differences are formatting (line numbers and page headers removed), addition of web navigation elements, and status metadata showing passage dates in both chambers.

02/19/26 - Introduced → 05/14/26 - Amended Senate · 4 edits · May 14, 2026

MODERATE

The amended version significantly narrows the compliance obligation imposed on examined insurance companies. Instead of requiring compliance with all recommendations in an examination report (which could include advisory or best-practice suggestions), the bill now only requires corrective actions to remediate violations of specific legal authorities: applicable statutes, regulations, statutory accounting principles referenced in Section 923, and other legally binding rules. The amendment also adds a new extension mechanism allowing companies to request additional time to comply for good cause.

Scope change

The bill's scope was narrowed: it no longer applies to all examination report recommendations, only to those addressing violations of legally binding authorities (statutes, regulations, statutory accounting principles under Section 923, and other legally binding rules). This excludes advisory or best-practice recommendations from triggering penalties.

REQUIREMENT

The compliance obligation was narrowed from 'comply with all recommendations' to 'take corrective actions to remediate violations of applicable statutes, regulations, statutory accounting principles as referenced in Section 923, and other legally binding applicable rules.' This means companies are no longer required to follow advisory or non-binding recommendations.

ELIGIBILITY

A new subsection (c)(2) allows a company to request additional extensions of 30 calendar days (or greater with commissioner approval) for good cause. The commissioner may deny the request if it is not made in good faith or there has not been a good faith effort to comply. 'Good cause' includes circumstances beyond the company's control, a showing of good faith effort, or other factors agreed to by the commissioner.

DEFINITION

A new subsection (c)(3) clarifies that failure to take corrective action is determined per specific category of corrective action requested as described in the examination, rather than as a single monolithic determination.

FISCAL

The penalty language was slightly reworded from 'the company shall be fined up to twenty thousand dollars' to 'the company shall be fined subject to a penalty of up to twenty thousand dollars,' but the maximum amount per recommendation remains $20,000.

Floor votes · Senate May 19, 2026 · Assembly Aug 27, 2026

How they voted

30–8

Passed · 2 other

Total votes 40

May 19, 2026

D Democratic30

30 Yea

100% Yea

R Republican10

8 Nay 2

80% Nay

Vote distribution

All Yea All Nay Mixed No data

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Aug 28, 2026

Upper · Passed

Assembly amendments concurred in. (Ayes 31. Noes 0.) Ordered to engrossing and enrolling.

upper

Aug 28, 2026

Introduced

In Senate. Concurrence in Assembly amendments pending.

upper

Aug 27, 2026

Lower · Passed

Read third time. Passed. Ordered to the Senate.

lower

Aug 5, 2026

Lower · Passed

From committee: Do pass. (Ayes 12. Noes 2.) (August 5).

lower

Jun 17, 2026

Lower · Passed

From committee: Do pass and re-refer to Com. on APPR. (Ayes 15. Noes 1.) (June 17). Re-referred to Com. on APPR.

lower

Jun 10, 2026

Lower · Passed

From committee with author's amendments. Read second time and amended. Re-referred to Com. on INS.

lower

May 26, 2026

Committee

Referred to Com. on INS.

lower

May 19, 2026

Upper · Passed

Read third time. Passed. (Ayes 30. Noes 8. Page 4359.) Ordered to the Assembly.

upper

May 14, 2026

Upper · Passed

Read second time and amended. Ordered to second reading.

upper

May 14, 2026

Upper · Passed

From committee: Do pass as amended. (Ayes 5. Noes 1. Page 4269.) (May 14).

upper

Apr 23, 2026

Upper · Passed

From committee: Do pass and re-refer to Com. on APPR. (Ayes 5. Noes 2. Page 4012.) (April 22). Re-referred to Com. on APPR.

upper

Mar 4, 2026

Committee

Referred to Com. on INS.

upper

Feb 19, 2026

Introduced

Introduced. Read first time. To Com. on RLS. for assignment. To print.

upper

1 primary · 0 co-sponsors