Comments on Draft Decision
Although this matter is uncontested, we have imposed conditions on the grant of authority. Thus, the draft decision is subject to public review and comment prior to issuance. On June 28, 2001, the draft decision of the ALJ in this matter was mailed to the parties in accordance with Pub. Util. Code § 311(g)(2) and Rule 77.7 of the Rules of Practice and Procedure. Applicant agreed to shorten the 30-day public review and comment period. Accordingly, comments were filed on July 5, 2001.
1. Some NIAC members provide transportation services incidental to the operation of youth camps and thus are required to register as private carriers with the Commission pursuant to Public Utilities Code § 5353(n).
2. Some NIAC members have had difficulty registering with the Commission because their liability insurance is not written by a California licensed insurer as required by GO 160-A.
3. NIAC provides insurance to nonprofits by the pooling of premium contributions; in doing so, it is not an "insurance company" regulated by the Department of Insurance, but rather is regulated by the Attorney General as a charitable, nonprofit corporation, pursuant to § 5005.1 of the Corporations Code.
4. NIAC's application includes detail about its current financial resources and its recent claims handling history; this information indicates that above $150,000 liability coverage in any one accident, NIAC is reinsured by General Reinsurance and Swiss Reinsurance.
5. NIAC's current $6,000,000 reserve exceeds the $5,000,000 maximum that could be required to protect the public under GO 160-A.
6. It is appropriate for the Commission to monitor NIAC's reserve and reinsurance arrangements to ensure the protection of the public.
1. As recently amended, Vehicle Code § 4000.37 directs the DMV to accept automobile insurance policies issued by NIAC, and any other Corporations Code § 5005.1 entity; thus, the Legislature has determined that automobile insurance, in the proper amounts, issued by NIAC is equivalent to that issued by companies regulated under the Insurance Code.
2. NIAC is substantially equivalent to "a company licensed to write such [liability] insurance in the State of California" as used in GO 160-A.
3. The Commission staff should be directed to accept proof of coverage from NIAC as complying with GO 160-A, subject to the conditions imposed in this order.
Therefore, IT IS ORDERED that:
1. Proof of liability coverage in no less than the required amounts from Nonprofits' Insurance Alliance of California (NIAC) shall be accepted as complying with General Order 160-A.
2. NIAC shall notify the Director of Commission's Rail Safety and Carriers Division (RSCD) in writing within 10 days, if its surplus falls below $5,000,000.
3. NIAC shall notify the Director of RSCD, in writing, within 10 days of any change in the amount of each claim covered by NIAC ($150,000), or any other change in its present reinsurance coverage arrangement.
4. This proceeding is closed.
This order is effective today.
Dated , at San Francisco, California.
(See formal files for Attachment A.)
