Assembly Bill 1297
Status: Signed into Law (July 14, 2025)
Effective Date: January 1, 2027
Primary Focus: Automatic Temporary Restraining Orders (ATROs) and Insurance Continuity
Assembly Bill 1297 (Stefani) closes a critical legal loophole in California divorce and legal separation proceedings. Under current law, when a party is served with a summons, “Automatic Temporary Restraining Orders” (ATROs) take effect, prohibiting both spouses from canceling or modifying insurance policies. However, some parties previously avoided this by simply allowing policies to lapse due to nonpayment or failing to renew them. AB 1297 amends Family Code Section 2040 to explicitly state that allowing a policy to lapse for nonpayment or failing to renew is legally equivalent to canceling the policy, thereby violating the restraining order.
1. Closing the “Cancellation” Loophole
- Passive Actions Prohibited: The law clarifies that restraining orders apply not just to affirmative acts of cancellation, but also to passive neglect.
- Nonpayment of Premiums: Parties are now explicitly restrained from “allowing to lapse for nonpayment of premiums” any existing insurance coverage.
- Failure to Renew: Failing to renew a policy that is set to expire during the litigation is now a violation of the ATROs.
2. Maintaining the “Status Quo Ante”
- Purpose: The bill ensures that the financial and medical security of both spouses and their children remains unchanged until the court can make final orders regarding asset distribution and support.
- Enforcement: By making these requirements explicit in the summons, the court can more easily hold a party in contempt if they allow essential coverage to disappear during the case.
3. Covered Types of Insurance
The updated restraining order applies to any insurance or other coverage held for the benefit of the parties and their children, specifically including:
- Health and Dental: Ensuring neither party is left without medical coverage during the separation.
- Life Insurance: Preventing the removal of beneficiaries or the loss of death benefits.
- Automobile Insurance: Maintaining liability and collision protection for vehicles used by the family.
- Disability Insurance: Protecting the income stream of either party in the event of an injury.
4. Protection for Beneficiaries
- Modification Ban: In addition to maintaining the policies themselves, parties remain strictly prohibited from changing the beneficiaries of any insurance or other coverage without written consent or a court order.
- Children’s Support: The law specifically emphasizes protections for coverage held for the benefit of any children for whom support may be ordered.