H-4574              _______________________________________________

                                          SUBSTITUTE HOUSE BILL NO. 2011

                        _______________________________________________

                                                                            C 069 L 86

State of Washington                              49th Legislature                              1986 Regular Session

By House Committee on Financial Institutions & Insurance (originally sponsored by Representatives P. King and Addison)

Read first time 2/7/86 and passed to Committee on Rules.

AN ACT Relating to funds of insurance brokers, agents, and solicitors; adding a new section to chapter 48.17 RCW; prescribing penalties; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1.  A new section is added to chapter 48.17 RCW to read as follows:

          (1) All funds representing premiums or return premiums received by an agent, solicitor or broker in his or her fiduciary capacity shall be accounted for and maintained in a separate account from all other business and personal funds.

          (2) An agent, solicitor or broker shall not commingle or otherwise combine premiums with any other moneys, except as provided in subsection (3) of this section.

          (3) An agent, solicitor or broker may commingle with premium funds any additional funds as he or she may deem prudent for the purpose of advancing premiums, establishing reserves for the paying of return premiums, or for any contingencies as may arise in his or her business of receiving and transmitting premium or return premium funds.

          (4) Each wilful violation of this section shall constitute a misdemeanor.

NEW SECTION. Sec. 2.                             This act shall take effect on January 1, 1987. Passed the House February 17, 1986.

Speaker of the House.

Passed the Senate March 3, 1986.

President of the Senate.