Cal. Insurance Code § 10505

(a) A labor union having all of the following characteristics is exempt from the provisions of this code relating to life and disability insurance in respect to the benefits herein specified and transactions connected therewith: (1) It is organized for the purpose of collective bargaining concerning grievances, labor disputes, wages, rates of pay, hours of employment, or conditions of work and for the mutual benefit of its members and not for profit. (2) Either (A) it does not issue policies but provides for payment of those benefits in its bylaws, constitution, or rules and regulations; or (B) it is composed of members of one craft or industry or allied craft or industries. (3) The payment of those benefits is incidental to the purposes of that union. (b) Any incorporated organization, the membership and insurance in which are restricted to members of that labor union and the officers of which are members of the labor union, is likewise exempt from this code to the same extent as that labor union. (c) Any organization described in either subdivision (a) or (b) is also exempt from all provisions of this code relating to insurance protecting against wage losses from any cause in respect to the benefits promised.