Jones

In this case, a trucking company participated in the California Automobile Assigned Risk Plan (the CAARP), a statutorily created program governed by the Insurance Commissioner designed to make automobile liability insurance available to those unable to obtain insurance through ordinary methods. After a premium billing dispute with its insurance company, which was hired by the CAARP, the trucking company defended a collection action and filed a cross-complaint against the company alleging that it had retroactively and knowingly charged it a substantially higher premium than was actually owed, and was therefore liable for tortious breach of the covenant of good faith and fair dealing and for fraud. A jury found in favor of the trucking company.

We are asked to decide two questions. The first is whether the trucking company was required to exhaust the administrative remedies available to those participating in the CAARP before bringing a lawsuit in which the central issue was the determination of the proper premium to be charged, a matter governed by the CAARP’s and the Insurance Commissioner’s internal regulations. We conclude that exhaustion of remedies was not required…