Brown signs law targeting insurance industry ties with Iran

Gov. Jerry Brown has signed into law a bill aimed at dissuading California-based insurance companies from making indirect investments in Iran. 

The state’s insurance companies already are prohibited from making large direct investments in Iran; the new law aims to put further economic pressure on Iran by stopping California’s insurance companies from listing any indirect investments in Iran on the financial statements that the state’s insurance commissioner uses to determine their fiscal health. 

Jointly authored by Assembly members Bob Blumenfield (D-San Fernando Valley) and Mike Feuer (D-Los Angeles), the new law, known as AB 2160, had support from Rep. Howard Berman, who wrote a letter to Brown in August urging the governor to sign the bill. In May, the Jewish Public Affairs Committee of California lobbied lawmakers on behalf of the bill. 

In 2009, insurers licensed to do business in California held $2 billion worth of indirect investments in companies tied to Iran, according to a study conducted in 2009 by then-Insurance Commissioner Steve Poizner. 

The new law, which is expected to impact approximately 160 California-based insurance companies, is only the latest piece of legislation written by Feuer and Blumenfield targeting Iran in the hopes that increased economic pressure might persuade that regime to abandon its nuclear enrichment efforts. In 2010, the two assembly members authored AB 1650 to prohibit the state and local governments from pursuing contracts with companies that do business in Iran’s energy sector. That law served as a model for similar legislation enacted in Florida in 2011.