UPDATE: California governor signs law to create more transparency in veterinary health insurance


California holds the most pet insurance policies of any state in the U.S.

Purported to be the first consumer protection legislation for pet insurance consumers of its kind in the United States, California's A.B. 2056 was signed by Gov. Jerry Brown. Sponsored by California Insurance Commissioner Dave Jones and supported by pet health insurance provider VPI, the law was designed to increase policy transparency for California residents-a market that is expected to reach $750 million in the state next year.

The regulations set forth in the bill will apply to California pet insurance policyholders regardless of where the policies are marketed, issued, amended, renewed or delivered, and regardless of the location of the contract or master group policyholder, or the jurisdiction in which the contract was issued or delivered.

The law goes into effect July 2015 and stipulates the following:

> Definition of certain terms and specification of certain disclosures a pet insurer is required to make to consumers.

> Disclosure of whether a policy excludes coverage because of a preexisting condition, a hereditary disorder, a congenital anomaly or a chronic condition.

> Policies to have a no less than 30-day "free look" cancellation period.

The new law also authorizes the commissioner to hold a hearing to determine whether an insurer is in violation of A.B. 2056 and to assess a civil penalty not to exceed $5,000 for each violation or $10,000 for a willful violation.

California holds the highest number of pet policies for VPI-18.4 percent of VPI's total policyholders. In fact, as the most populous state, California holds the top spot for most pet insurance companies, including ASPCA, Embrace, Pets Best and Trupanion. Based in Brea, Calif., VPI claims to be the first in the industry to support the bill.

"VPI is the only pet health insurance provider to publicly support the bill that will bring uniformity to policy language and disclosure, thereby increasing transparency in pet insurance policies issued to California residents," VPI spokesman Adam Fell says in an email to dvm360.

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