Section 2248.5 - Claims and Claims Review Procedure(a) The insurer shall be responsible for the settlement, adjustment and payment of all claims and shall establish and maintain adequate claim files, which may be reviewed and examined by the Commissioner. All claims shall be promptly reported to the insurer, or its designated claim representative, and all claims shall be settled as soon as possible in accordance with the terms of the insurance contract.(b) All claims shall be paid, either by draft drawn upon the insurer or by check of the insurer, directly to the order of the claimant to whom payment of the claim is due under the policy, or to the payee specified by such claimant. If the insurance payable exceeds the balance which the debtor or his estate are obligated to pay to the creditor, the insurer shall pay the excess directly to the person or estate entitled to such excess, or establish procedures to be followed the creditor or make such payments, in which case the insurer must take all reasonable precautions to make certain such procedures are followed.(c) No person, firm or corporation other than the insurer or its designated claim representative shall be authorized to settle or adjust claims. Neither the creditor nor the general agent or agent of the insurer shall be designated claim representative for the insurer in settling or adjusting claims. A group policyholder, however, by arrangement with the insurer, may draw drafts or checks in payment of claims due to the group policyholder subject to audit and review by the insurer.Cal. Code Regs. Tit. 10, § 2248.5
Note: Authority cited: Section 779.21, California Insurance Code.