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SB 782 would expand the
authority of the commissioner of insurance to investigate an offense under the
Penal Code that may be related to a fraudulent insurance act. Additionally, the
commissioner would be allowed to provide technical or litigation assistance to
other governmental agencies relating to fraudulent insurance acts or offenses
under the Penal Code.
Insurance fraud results in higher premium costs for all
policyholders since insurers divide the costs of claims among all policyholders.
By allowing the commissioner to investigate any offense under the Penal Code,
the commissioner is made into another law enforcement agent. This type of
authority goes too far by granting the commissioner of insurance power that falls
outside its scope.
However, according to the author’s office, the commissioner
already retains that authority under different provisions of the Penal Code. This
legislation would only clarify that existing authority in the Insurance Code.
For this reason, we stand neutral on SB 782.
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