CALIFORNIA INSURANCE CODE SECTION 1875.20-1875.23

1875.20. Every insurer admitted to do business in this state shall maintain a unit or division to investigate possible fraudulent claims by insureds or by persons making claims for services or repairs against policies held by insureds. 1875.21. Insurers may maintain the unit or division required by this article using its employees or by contracting with others for that purpose. 1875.22. Insurers shall establish the unit or division required by this article no later than July 1, 1992. 1875.23. For purposes of this article, "unit or division" may include the assignment of fraud investigation to employees whose principal responsibilities are the investigation and disposition of claims. If an insurer creates a distinct unit or division, hires additional employees, or contracts with another entity to fulfill the requirements of this article, the additional cost incurred shall be included as an administrative expense for ratesetting purposes.