H-4334              _______________________________________________

                                          SUBSTITUTE HOUSE BILL NO. 2088

                        _______________________________________________

State of Washington                              49th Legislature                              1986 Regular Session

By House Committee on Financial Institutions & Insurance (originally sponsored by Representative Lux)

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

AN ACT Relating to insurance; creating a new chapter in Title 48 RCW; and providing effective dates.

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

NEW SECTION. Sec. 1.     Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

          (1) "Applicant" includes an individual, corporation, government, or governmental subdivision or agency, business trust, estate, trust, partnership or association, two or more persons having a joint or common interest, or any legal or commercial entity.

          (2) "Property and casualty insurance" means property insurance as defined in RCW 48.11.040 and casualty insurance as defined in RCW 48.11.070.

          (3) "Association" means the joint underwriting association established pursuant to the provisions of this chapter.

          (4) "Plan" means the market assistance plan established pursuant to the provisions of this chapter.

NEW SECTION. Sec. 2.     The commissioner shall approve a reasonable market assistance plan for the placement of property and casualty insurance coverages for applicants who have difficulty in obtaining the type of insurance desired.  The plan shall assist in obtaining property and casualty insurance for municipal liability, day care liability, liquor liability, trucking liability and professional liability.  In addition, the commissioner shall determine whether availability problems exist for other types of property and casualty insurance and shall require the plan to assist applicants in obtaining such insurance.

NEW SECTION. Sec. 3.     All insurers possessing a certificate of authority to write property or casualty insurance within this state shall participate in the plan approved by the commissioner as a condition of its authority to continue to transact business in this state.  However, the commissioner may exclude an insurer from membership if the commissioner determines membership would result in a hardship or inequity or would not be of benefit to the plan.

NEW SECTION. Sec. 4.     The commissioner may adopt any rules necessary to ensure the effective operation of the plan, including but not limited to, setting limits on the fees the plan may charge to process an applicant's request for assistance.  The commissioner shall not require that the plan provide insurance to applicants.

NEW SECTION. Sec. 5.     The commissioner shall approve a reasonable design for the establishment of a nonprofit, joint underwriting association for property and casualty insurance, subject to the conditions and limitations contained in this chapter.

NEW SECTION. Sec. 6.     The association shall be comprised of all insurers possessing a certificate of authority to write property and casualty insurance within this state on a direct basis.  Every such insurer shall be a member of the association and shall remain a member as a condition of its authority to transact business in this state, unless the commissioner excludes an insurer from membership because membership would result in a hardship or inequity.

NEW SECTION. Sec. 7.     An applicant may seek property and casualty insurance from the association whenever the commissioner determines that the type of insurance the applicant desires is difficult to obtain in the usual market for such insurance.

NEW SECTION. Sec. 8.     The commissioner may adopt all rules necessary to ensure the efficient, equitable operation of the association.

NEW SECTION. Sec. 9.     Sections 1 through 8 of this act shall constitute a new chapter in Title 48 RCW.

NEW SECTION. Sec. 10.    Sections 1 through 4 of this act shall take effect on June 1, 1986.  Sections 5 through 8 of this act shall take effect on June 1, 1988.