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| CAARP Introduction, Part I: What is CAARP? | ||||||
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Producer Performance Standards Per Section 20 of the CAARP Plan of Operations, producers must comply with specific requirements in the writing and submitting of CAARP Private Passenger, CAARP Commercial, and LCA Program applications. Completing the Application A producer is required to submit a fully completed application so the assigned insurance company can:
Every application must include:
Valid Driver's License The producer must submit legible photocopies of a valid Driver's License for the applicant and all principal drivers. Acceptable Driver's Licenses include:
For non-California driver's licenses the assigned company will need proof of a California Driver's License in 30 days, except applicants in the military who are based in California are not required get a California Driver's License. If the driver's license is unavailable because it has been suspended or revoked, the application shall clearly reflect the driver's license number and producer should indicate in Remarks the circumstances of the suspension/revocation. Vehicle Registration/Proof of Ownership The producer must also submit a legible photocopy of the current registration or proof of ownership for each vehicle to be insured (non-owner risks excluded). If a current vehicle registration is not available, CAARP will accept the following documents to show proof of ownership:
Providing Evidence of Insurance Producers are not allowed to issue ID Cards or Insurance Binders for their clients at the time of application. The California Department of Motor Vehicles will not accept ID cards with "CAARP", "CA Assigned Risk" or "CA Low Cost" listed as the company. This is because:
It is advised that producers provide their client with a photocopy of the application and let them know that the CAARP/LCA assignment letter should be in the mail within 7-10 days. It is also advised to tell them to keep the copy of the application in their car until their letter arrives. Electronic Effective Dates must be Voided If the Electronic Effective Date Procedure (EEDP) or the Electronic Application Submission Interface (EASi) is used to propose an effective date of coverage and it is decided that coverage is not wanted with CAARP/LCA, the Retraction Request Form must be submitted to CAARP within four calendar days. If the producer fails to void unwanted EEDP or EASi reference numbers at least 3 times in a 6-month period, the producer will be charged a violation. Producers Must Abide by California Insurance Law If a producer violates any provision of the California Insurance Code, CAARP is obligated to notify and warn the producer of their violations.
This includes charging fees for any changes to an in-force policy. Producers who are found to be charging broker fees will be investigated by CAARP. In-Force Policies Once the application is assigned to an insurance company, a producer's performance is still tracked. Each failure to comply with one of these producer performance standards is considered one violation of the producer performance standards. Renewals The renewal premium shall be submitted gross to the insurer or servicing carrier. Commission cannot be withheld. The producer shall immediately send all renewals payments received from their insureds to ensure it is received by the due date. Return Commission If a policy is canceled before the end of the policy term by the insured or the company, the producer returns the unearned commission to the company within 30 calendar days of notification that payment is due. Policy Change Requests If a producer receives a policy change request from the insured, the producer shall send a written request to the assigned company within three business days of receipt of the request. Producers should make sure that the change request is accurate, legible, and accompanied by an appropriate deposit, where applicable, in accordance with the Plan regulations. Claims The producer must report all claims to the assigned company within one business day after the insured reports the accident to them. The producer can report the claim either by telephone or fax to the company. Payments
Note: If the applicant's check is submitted with the application and it is NSF, there is no coverage. If the producer's check is submitted, there is coverage regardless if the applicant's check to the producer is NSF. Maintenance of Records
Fraud or Misrepresentation A producer shall not make false statements or misrepresentations, nor aid or abet any applicant in making false statements in connection with any application or other dealings with CAARP or assigned company. Violations of CAARP's Producer Performance Standards
Step Letter Procedure
Peer Review Subcommittee CAARP's Peer Review Subcommittee is made up of five certified producers who make recommendations to CAARP's Advisory Committee regarding producer performance issues. After reviewing the producer's performance the Peer Review Subcommittee may make any of the following recommendations:
The Peer Review Subcommittee sends its recommendation to CAARP's Advisory Committee for a final decision. A letter is then sent to the producer notifying him/her of the decision of the Subcommittee/CAARP Advisory Committee. In most cases decision letters are faxed and mailed Certified Mail/Return Receipt to the producer's office to ensure that the producer receives the notice. The producer has the right to appeal any decision of CAARP's Peer Review Subcommittee by sending a written request for an appeal to CAARP's office within 30 days from the decision letter. All Peer Review appeals are sent to the Department of Insurance for final decision. |
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© 2008, LunchTimeCE, Inc and AIPSO. All Rights Reserved. |
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Not only are policy forms, clauses, rules and court decisions constantly changing, but forms vary from company to company and state to state. This material is intended as a general guideline and might not apply to a specific situation. The authors, LunchTimeCE, Inc. and AIPSO, and any organization for whom this course is administered will have neither liability nor responsibility to any person or entity with respect to any loss or damage alleged to be caused directly or indirectly as a result of information contained in this course. |
