California Insurance Guarantee Association: insurer insolvency.

Existing law requires the California Insurance Guarantee Association to collect premium payments from member insurers sufficient to cover the obligations of an insurer that has become insolvent. Under existing law, the rate of premium charged a member insurer is a uniform percentage of the net direct written premium of the insurer in the preceding calendar year. Existing law provides that the initial premium charge shall be adjusted by applying the same rate of premium charge as initially used to each insurer's written premium as shown on the annual statement for the 2nd year following the year in which the initial premium charge is made. This bill would, instead, provide that the initial premium charge shall be adjusted by applying the same rate of premium charge as initially used to each insurer's written premium as shown on the annual statement for the 2nd year following the year on which the initial premium charge was based.