CA Dept. of Insurance
From California Department of Insurance Website: (http://www.ca.doi.gov) -Visit Date: 8/16/02
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CALIFORNIA CODE OF REGULATIONS, TITLE 10, CHAPTER 5, SUBCHAPTER 4.7:
TABLE OF CONTENTS
SUBCHAPTER 4.7. PRIVATE PASSENGER AUTOMOBILE RATING FACTORS.
Article 4. Good Driver Discount Policy.
Section 2632.12 Good Driver Discount.
Section 2632.13 Eligibility to Purchase Good Driver Discount
Policy and Guidelines for Determination of “Principally At-Fault.”
Section 2632.14 Policies Offered to Good Drivers and Nondiscrimination.
Section 2632.15 Data Bank.
Section 2632.16 Severability.
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Article 4. Good Driver Discount Policy.
Section 2632.12 Good Driver Discount.
(a) Every insurer offering a policy of automobile insurance shall set its rates so that a good driver, as defined in Section 1861.025 of the California Insurance Code, shall be charged a rate that is at least 20 percent less that the lowest rate available to a comparable driver who is not a good driver. The good driver discount must be applied after the total premium is developed under the class plan, including any policy fees that apply to the issuance of the policy.
(b) If a good driver as determined pursuant to California Insurance Code Section 1861.025 is not eligible to purchase a good driver discount policy because of the driving safety record or years of driving experience of any other person, then the good driver shall be eligible to purchase a good driver policy which excludes such other persons from coverage.
NOTE: Authority: Sections 1861.02, 1861.025, 12921, and 12926 of the California Insurance Code. Reference: Section 1861.02 and 1861.05 of the California Insurance Code.
Section 2632.13 Eligibility to Purchase Good Driver Discount Policy and Guidelines for Determination of “Principally At-Fault.”
(a) In determining a driver’s qualification to purchase a good driver discount policy pursuant to California Insurance Code Section 1861.025, an insurer shall determine the driver’s violation points and principally at-fault accidents as set forth in this section. This section shall also apply in determining whether a driver was principally at-fault in an accident for the purpose of determining the driver’s driving safety record (First Mandatory Factor).
(b) Violation point counts and principally at-fault accidents shall be determined as follows:
(1) The insurer may count one violation point for each violation point which has been assessed by the California Department of Motor Vehicles under California Vehicle Code Section 12810, Subsections (a), (b), (c), (d), (e), (g) and (h), for traffic violation convictions with conviction dates not more than three years preceding the effective or renewal date of the policy, and which have not been made confidential under the California Vehicle Code;
(2) For violations not occurring in California, the insurer may count one violation point for each violation point which would have been counted under subsection (1) above had the violation occurred in California. Violation points shall not be counted pursuant to this Subsection if violation points were counted for the violation pursuant to Subsection (b)(1) above;
(3) The insurer may count one violation point if a driver was involved in an accident which resulted only in damage to property if the driver was principally at fault in the accident, as defined in Subsection (c). A driver may also be determined to be principally at fault for such an accident where the accident was a solo vehicle accident, subject to the exceptions set forth in subsection (d).
(c) a driver may be considered to be principally at fault in an accident if the driver’s actions or omissions were at least 51 percent of the proximate cause of the accident, subject to the exceptions set forth in Subsection (d), and, in accidents not resulting in death, if the total loss or damage caused by the accident exceeded $500.00.
(d) A driver shall not be considered to be principally at-fault if the accident occurred under any of the following circumstances:
(1) The vehicle was lawfully parked at the time of the accident. A vehicle rolling from a parked position shall not be considered to be lawfully parked, but shall be considered as in the operation of the last operator;
(2) The vehicle was struck in the rear by another vehicle, and the driver has not been convicted of a moving traffic violation in connection with the accident;
(3) The driver was not convicted of a moving traffic violation and the operator of another vehicle involved in the accident was convicted of a moving traffic violation;
(4) The driver’s vehicle was damaged as a result of contact with a vehicle operated by a “hit and run” operator of another vehicle and the accident was reported to legal authorities within a reasonable time after the accident;
(5) The accident resulted from contact with animals, birds, or falling objects;
(6) The driver was responding to a call of duty as a paid or volunteer member of any police or fire department, first aid squad, or of any law enforcement agency, while performing any other governmental function in a public emergency;
(7) The accident was a solo vehicle accident that was principally caused by a hazardous condition of which a driver, in the exercise of reasonable care, would not have noticed (for example, “black ice.”)
(e) An insurer providing insurance coverage at the time of an accident shall not make a determination that a driver was principally at-fault for an accident, other than an indisputably solo vehicle accident and which is not of the type specified in subpart (d), unless the insurer first does the following:
(1) the insurer shall make an investigation of the accident;
(2) the insurer shall provide written notice to the insured of the result of such investigation, including any determination that the insured was principally at-fault. The notice shall specify the following: the percentage of fault ascribed to the insured; the percentage of fault ascribed to any other driver or other cause of the accident; the basis of any determination that a driver was principally at-fault. The notice shall advise the insured of the right to reconsideration of the determination of fault, as set forth in Subsection (e)(3);
(3) Within 30 days of receipt by the insured of a written notice required by Subsection (e)(2), the insured may request reconsideration of the insurer’s determination that the insured was principally at-fault, including the insurer’s determination of the percentage of fault ascribed to any driver. The insurer shall provide written notice of its decision upon reconsideration within 30 days of the insured’s request therefor and the notice shall state the reasons for its decision upon reconsideration. The reconsideration shall be made by an employee or agent of the insurer other than the employee or agent who made the determination being reconsidered. The right to reconsideration set forth herein shall not affect any other rights of the insured.
(f) If a driver had insurance that provided coverage for an accident, a subsequent insurer which did not provide coverage at the time of the accident and to whom an application for the issuance of a policy of insurance is made, or from whom a renewal policy is offered, may not consider the driver to be principally at-fault for the accident unless the following circumstances apply:
(1) if the insurer that provided coverage at the time of the accident charged the driver with a violation point for the accident in accordance with this Section, or the predecessor of this Section; or,
(2) if the driver was not covered by an automobile insurance policy delivered or issued for delivery in California and issued and in force pursuant to the laws of California at the time of the accident, and theinsurer determines that the driver was principally at-fault as provided for in Subsection (g); or,
(3) if the insurer of the driver at the time of the accident did not have notice of the accident and no other insurer of any person involved in the accident made a determination that any other driver was at least 51% of the proximate cause of the accident, and the insurer determines that the driver was principally at fault as provided for in Subsection (g).
(g) If the driver did not have insurance that provided coverage for an accident, and if no other insurer of any person involved in the accident made a determination that any other driver was at least 51% of the proximate cause of the accident, an insurer to whom an application for the issuance or renewal of a policy of automobile insurance is made may consider a driver to be principally at-fault if the insurer has sufficient information to make that determination. For the purpose of this Subsection, the following shall apply:
(1) the insurer shall make reasonable efforts to obtain information concerning the accident from any insurer of a person
involved in the accident;
(2) the insurer shall request sufficient information from the driver;
(3) upon reasonable request by the insurer, a driver shall provide sufficient information concerning the accident to the insurer for the insurer to determine whether the driver was principally at- fault. If the driver fails or refuses to provide such information, then the insurer may count a violation point for the accident or may consider the driver to be principally at-fault.
(h) an insurer that has made a determination that its insured was principally at-fault in an accident shall not refuse to disclose that determination to any person involved in that accident, to any person legally responsible for damages resulting from that accident, or to an insurer or prospective insurer of any such person. the requirement for disclosure shall pertain only to the ultimate determination of its insured’s fault, and disclosure shall not be required of any other information in its possession or any determination of fault of any person other than the insured.
(i) In determining eligibility to purchase a good driver discount policy, the requirement that the driver have been licensed to drive a motor vehicle for the previous three years shall mean that the driver has been licensed to drive in any jurisdiction.
NOTE: Authority: Sections 1861.02, 1861.025, 12921 and 12926 of the California insurance Code, and Calfarm Insurance Company v. Deukmejian 48 Cal.3d 805 (1989). Reference: Sections 1861.025 and 1861.05 of the California Insurance Code and Section 12810 of the California Vehicle Code.
Section 2632.14 Policies Offered to Good Drivers and Nondiscrimination.
(a) Except as provided by Insurance Code Section 1861.15(d) every insurer required to offer a good driver discount policy of automobile insurance pursuant to Section 1861.02(b) of the California Insurance Code shall offer to sell each of the following to a good driver:
(1) a good driver policy that contains only the minimum limits of liability coverage specified in Section 16056 of the California Vehicle Code;
(2) a good driver discount policy that contains comprehensive coverage or automobile collision coverage, or both of such coverages, in addition to automobile liability coverage;
(3) a good driver discount policy that contains any of the limits of coverage, the types of coverage, and amounts of deductibles that the insurer offers to sell to the public.
(b) Insurers required to offer good driver discount policies pursuant to Section 1861.02(b) of the California Insurance Code shall offer and sell good driver discount policies under the same terms and conditions and with the same options and services that the insurer offers and sells to the public for any other automobile insurance policy. The foregoing includes but is not limited to terms for payment of premiums and the payment of commissions to agents.
NOTE: Authority: Sections 1861.02, 1861.15, 12921 and 12926 of the California Insurance Code. Reference: Section 1861.02 of the California Insurance Code.
Section 2632.15 Data Bank
(a) Every insurer offering or issuing a policy of automobile insurance shall collect and retain the data listed in this subsection. All data requirements apply only to aninsurer’s direct business. If an insurer does not in any way use or collect an item listed in subsection (3) below for any individual insured, they are not required to collect and report the item. This file will be referred to as the “Current File”. Insurers are required to collect and retain data on the listed factors, they are not required to use these factors in calculating premiums.
(1) All data must be kept in a computer file that allows for the insurer to place the data on computer media (tape, cartridge or disk). All data must be recorded in a raw, ungrouped format in a manner specified by the Commissioner.
(2) Every insurer shall begin collecting the data for current policy holders, beginning with all renewals effective on or after 180
days after the effective date of these regulations.
(3) The following items shall be kept for every currently insured vehicle:
(A) The latest effective or renewal date of the policy;
(B) The number of drivers assigned to this vehicle;
(C) The following information for the rated driver on this vehicle (as of the last renewal date for this policy or date of latest coverage or vehicle change). To the extent that it is available, all violation and accident data shall cover a minimum of six years.
1. The total number of convictions.
2. The date and California vehicle code section (or its equivalent) of each violation.
3. The total number of at-fault BI accidents with over $500 damage.
4. The date of each at-fault BI accidents with over $500 damage.
5. The total number of at-fault non-BI accidents with over $500 damage.
6. The date of each at-fault non-BI accidents with over $500 damage.
7. Number of years since the last at-fault BI accident with over $500 in damage.
8. Number of years since the last at-fault non-BI accident with over $500 in damage.
9. Number of years since the last convictions.
10. Gender.
11. Marital status (legally married, single or widowed only).
12. Percentage use this driver.
13. Years licensed to drive.
14. Age.
15. Smoker status.
16. Academic status. Indicator to describe if the driver is a student and if so if they qualify for a good student discount.
17. Senior defensive driver discount eligibility.
18. Driver training status.
19. Any other driver related factors the Commissioner has approved and the insurer uses.(D) The same information listed under (C) shall also be kept for every driver assigned to this vehicle. Data for each driver shall only be kept for one vehicle, unless there are excess vehicles in which case the data under (C) shall include the data for the driver that puts the most mileage on the excess vehicle.
(E) Additional vehicle indicator. This is used for insureds that have more vehicles than drivers where there is no rated driver.
(F) Zip Code of the vehicle’s location.
(G) Type of use indicator (pleasure only, business, commute, etc.).
(H) Weekly commute miles.
(I) Vehicle model year.
(J) Vehicle value (price group) code.
(K) Vehicle type; auto, light pickup truck, van, heavy truck, Motorcycle, antique auto or other.
(L) Vehicle performance type.
(M) Limits and deductibles, separately for all coverages.
(N) Good driver discount status.
(O) Multi-vehicle household.
(P) The number of semi-annual renewals for this policy.
(Q) Vehicle safety and anti-theft equipment, including by not limited to:
1. Anti-lock brake, including number of wheels covered;
2. Air bags, including number and location;
3. Automatic seat belts;
4. Anti-theft devices, including type;
5. Vehicle garaging status.
(R) Premiums, separately for each coverage.
(S) Actual previous years mileage, rounded to the nearest hundred miles.
(T) Estimated current years mileage for the 12 month period beginning with the start of this policy, rounded to the nearest hundred miles.
(U) Any other vehicle related factors the Commissioner has approved and the insurer uses.
(V) Any other factor the Commissioner has adopted by regulation.
(W) VIN.
(X) Policy number and vehicle number.
(4) Insurers shall maintain these data so that they are able to provide them to the Commissioner within three months of receipt of a request for the data.
(b) Every insurer issuing a policy of automobile insurance shall maintain historical underwriting, loss and exposure data for each calendar year for each of the latest four years for every insured vehicle. All data requirements apply only to an insurer’s direct business. If an insurer does not in any way use or collect an item listed in subsection (6) and (7) below for any individual insured, they are not required to collect and report the item. This data shall be kept in two files with records kept by each vehicle. One file will be referred to as the “Historical Exposure File”, and the other file will be referred to as the “Historical Losses File”.
(1) All data must be kept in a computer file that allows for the insurer to place each Calendar year’s data on computer media (tape, cartridge or disk). All data must be recorded in a raw, ungrouped format in a manner specified by the Commissioner.
(2) The data shall be kept for a minimum of four years after the end of each calendar year.
(3) Every insurer shall begin collecting the data for all policies in effect beginning the first of the quarter after the effective date of these regulations.
(4) All loss and loss reserve information shall reflect the loss and loss reserve estimates as of the latest calendar quarter. The data on losses occurring four years ago shall reflect the reserve estimates as of the latest quarter. All loss data shall be based on claims received by the insurer for that coverage as the consequence of a single incident regardless of the number of claimants.
(5) In the event of a change in any risk related factors, multiple records per vehicle shall be generated for the calendar year. A new record shall be generated for the “Historical Exposure File” each time any of the data in (a)(3)(C) through (V) changes.
(6) The “Historical Exposure File” shall contain the following items for every insured vehicle for all exposure during each calendar year:
(A) The data item listed in Section 2632.15(a);
(B) The termination date of the policy or a code indicating the policy is still in effect;
(C) Earned premium listed separately for each coverage;
(D) Earned exposure listed separately for each coverage.
(7) The “Historical Losses File” shall contain the following information for each claims a result of incidents occurring during the calendar year:
(A) Policy number and vehicle number. These numbers must match the policy number and vehicle number in the “Historical Exposure File” for the vehicle to which the loss is assigned;
(B) Date of accident;
(C) Number of claimants;
(D) Total dollar amount of incurred losses listed separately by coverage and including the latest estimate of the ultimate loss reserves and loss adjustment reserves as described in Section 2632.15(b) Paragraph (4).
(E) Capped losses for bodily injury liability coverages.
(F) Closed claim indicator by coverage.
(8) Insurers shall maintain these data so that they are able to provide them to the Commissioner within three months of receipt of a request for the data.
NOTE: Section 1861.02 and 1861.03, California Insurance Code and Calfarm Insurance Company v. Deukmejian (1989) 48 Cal.3d 805. Reference: Sections 1861.02 and 1861.03, California Insurance Code.
Section 2632.16 Severability.
If any provision of this Subchapter, or the application of any provision of this Subchapter to any person or to any circumstances is held invalid, that invalidity shall not affect other provisions or applications of these regulations which can be given effect without the invalid provisions or application, and to this end the provisions of these regulations are severable.
NOTE: Authority: Sections 12921 and 12926 of the California Insurance Code. Reference: Section 1861.02, 1861.025, 1861.15, and 11628 of the California Insurance Code.
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Last Revised – April 02, 1998
Copyright © California Department of Insurance
