California Insurance Code § 10965.02

Insurance Code
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For the purposes of determining eligibility for small employer coverage, a sole proprietor and the sole proprietor’s spouse are not considered employees with respect to a sole proprietorship that consists only of the sole proprietor and the sole proprietor’s spouse. A partner and a partner’s spouse are not employees of a partnership that consists solely of partners and their spouses. Employer group health benefit plans shall not be issued, marketed, or sold to a sole proprietorship or partnership without employees directly or indirectly through any arrangement. Only individual health benefit plans shall be sold to any entity without employees.

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