SECTIONS 13900-13907 - California Statutes

INSURANCE CODE

SECTION 13900-13907

13900. An affordable housing entity may join with one or more other
affordable housing entities in an arrangement providing for the
pooling of self-insured claims or losses with respect to any of the
following:
(a) Insurance covering all or any part of any tort liability.
(b) Insurance covering any employee of the affordable housing
entity against all or any part of his or her liability for injury
resulting from an act or omission in the scope of employment.
(c) Insurance covering any board member, officer, partner,
manager, member, or volunteer of the affordable housing entity
against any liability that may arise from any act or omission in the
scope of participation with the affordable housing entity.
(d) Insurance covering any loss arising from physical damage to
motor vehicles, personal property, real property, or other property
owned or operated by the affordable housing entity.

13901. (a) The pooling arrangement established pursuant to this
division shall not be considered insurance, and shall not be subject
to regulation under this code.
(b) All affordable housing entities participating in a pooling
arrangement established pursuant to this division shall be given
written notice, in at least 10-point type, that the pool is not
regulated by the Insurance Commissioner and that the state insurance
insolvency guaranty funds are not available to safeguard its risk.

13902. (a) Any insurance pool, established pursuant to this
division, may be organized as a nonprofit corporation, limited
liability company, partnership, or trust, whether organized under the
laws of this state or another state or operating in another state.
(b) Any insurance pool established pursuant to this division shall
have initial pooled resources of not less than two million five
hundred thousand dollars ($2,500,000) in the form of cash or cash
equivalents.
(c) Any insurance pool established pursuant to this division shall
maintain adequate reinsurance to protect against its risks.
(d) Any insurance pool established pursuant to this division shall
furnish a copy of the pool's annual audited financial statement and
most recent actuarial review, by first-class mail or by any other
method of delivery, including electronic transmission, to the
Assembly Committee on Housing and Community Development, the Assembly
Committee on Insurance, the Senate Committee on Banking, Finance,
and Insurance, and the Senate Committee on Transportation and Housing
within 180 days of the close of the pool's fiscal year. If, in the
period of time since the last submittal required by this subdivision,
any of the following has occurred, the transmittal letter
accompanying the annual audited financial statement and most recent
actuarial review shall so indicate and shall provide a brief
description of each matter:
(1) There has been a change to the pool's plan of financing,
management, or operation, including any material amendment to any of
those plans.
(2) A claims audit report has been filed with any regulatory body
with respect to the pool.
(3) A report of examination issued by any regulatory body with
respect to the pool has been received.
(4) There has been a material change in the scope of the
regulation of the pool by other states in which the pool operates.

13903. All participating affordable housing entities in any
insurance pool, established pursuant to this division, are required
to agree to pay premiums or make other mandatory financial
contributions, as determined by the governing board, provided for by
the insurance pool arrangement, that are necessary to ensure a
financially sound risk pool.

13904. Any insurance pool, established pursuant to this division,
shall not insure against any liability that may be insured against
pursuant to Division 4 (commencing with Section 3200) of the Labor
Code.

13905. Nothing in this division shall be construed to authorize an
affordable housing entity to pay for, to insure, to contract for
payment of, or to provide for payment for, any part of a claim or
judgment against an employee of the affordable housing entity for
punitive or exemplary damages.

13906. For the purpose of this division, "affordable housing" means
housing developments in which some of the dwelling units may be
purchased or rented, with or without government assistance, on a
basis that is affordable to persons or families of low or moderate
income, as defined in Section 50093 of the Health and Safety Code.

13907. For the purpose of this division, an "affordable housing
entity" means any of the following:
(a) A housing authority created under the laws of this state or
another jurisdiction and any agency or instrumentality of a housing
authority, including, but not limited to, a legal entity created to
conduct a self-insurance program for housing authorities that
complies with Chapter 5 (commencing with Section 6500) of Division 7
of Title 1 of the Government Code.
(b) A nonprofit corporation organized under the laws of this state
or another state that is engaged in providing affordable housing.
(c) A partnership, general or limited, or limited liability
company that is engaged in providing affordable housing and that is
affiliated with a housing authority described in subdivision (a) or a
nonprofit corporation described in subdivision (b) if the housing
authority or nonprofit corporation has one or more of the following:
(1) A financial or ownership interest in the partnership or
limited liability company or the right to acquire that interest.
(2) The power to direct the management or policies of the
partnership or limited liability company.
(3) A contract to lease, manage, or operate the affordable housing
owned by the partnership or limited liability company.