California Insurance Commissioner Orders Rebates


The COVID-19 pandemic and “Stay at Home” orders issued in response have had an immediate and significant impact on the activities of California businesses and individual policyholders.  As a result, California Insurance Commissioner Ricardo Lara has noted that “projected loss exposures of many insurance policies have become overstated or misclassified” and has ordered premium reductions for private passenger automobile insurance, as well as the following lines of business:

  • Commercial automobile insurance
  • Workers’ compensation insurance
  • Commercial multiple peril insurance
  • Commercial liability insurance
  • Medical malpractice insurance
  • Any other line of coverage where the measures of risk have become substantially overstated as a result of the pandemic.

California insurers have been given one hundred and twenty (120) days to comply with Commissioner Lara’s order.   Insurers may comply with the premium refund order by providing a premium credit, reduction, return of premium, or other appropriate premium adjustment to their insureds.

The Department of Insurance indicated that further reductions may be in order depending upon the length of the impact of the virus.

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