The Legislature hereby finds and declares as follows: The Legislature pursuant to its plenary power over workers’ compensation granted by Section 4 of Article XIV of the California Constitution has authorized classification of risks and premium rates and systems of merit rating for workers’ compensation insurance. The selective and discretionary inspection of locations, plants and operations of employers for classification and rating purposes, the gathering and compiling of experience statistics and other data by rating organizations licensed by the Insurance Commissioner, and the application of standards predicated upon the reliability of such classifications and merit rating data are essential to the proper functioning of the classifications of risks and premium rates and systems of merit rating which are regulated by the Insurance Commissioner as authorized by the Legislature.

In order to implement and facilitate the proper and adequate administration of such classifications of risks and rates and systems of rating by such licensed rating organizations and the Insurance Commissioner, it is important and in the public interest that licensed rating organizations and their officers and employees shall not be liable for injury or death or other damage caused or alleged to have been caused by their failure to inspect, or negligent or incomplete inspection of, an employer’s location, plant or operation for classification or rating purposes.

No licensed rating organization or member thereof in its character as a member, or officer or employee of such licensed rating organization when acting within the scope of his employment, shall be liable for injury or death or other damage proximately caused by a failure to inspect, or the manner or extent of inspection of, an employer’s locations, plants or operations for classification or rating purposes, or by such person’s comment, or failure to comment, on the subject matter or object of such inspection.

This section shall not be construed as implying the existence of liability in circumstances not defined in this section; nor as implying a legislative recognition that, except for the enactment of this section, a liability has existed or would exist in circumstances stated in this section.

(Amended by Stats. 1977, Ch. 579.)