z-1301                _______________________________________________

                                                   SENATE BILL NO. 4540

                        _______________________________________________

State of Washington                              49th Legislature                              1986 Regular Session

By Senators Bender, Deccio, Moore, von Reichbauer, Bauer, Zimmerman, Johnson, Newhouse, Hansen, McManus, Conner and Rasmussen; by request of Joint Study Committee on Insurance Availability and Affordability

Read first time 1/15/86 and referred to Committee on Financial Institutions.

AN ACT Relating to insurance agency agreements; and adding a new section to chapter 48.17 RCW.

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) If an insurer intends to cancel a written agreement with an agent, or intends to refuse any class of renewal business from the agent, the insurer shall give the agent not less than one hundred twenty days' advance written notice of such intent.  Every insurer canceling a written agreement subject to this section shall permit, for not less than one year after having given notice of its intent to terminate the agency agreement, insureds to process their renewals through the agent, as long as he or she retains an agent's license for the kind of insurance involved, as to any of the policies which have not been replaced with other insurers as expirations occur.  An agent with a canceled agreement subject to this section shall remain an agent of the canceling insurer as to actions associated with any such policies just as if he or she were appointed by such insurer as its agent.  This subsection shall not apply to:  (a) Agents or policies of a company or group of companies if the business is owned by the company or group of companies and the cancellation of any such contractual agreement does not result in the cancellation or nonrenewal of any policies of insurance; or (b) life, disability, surety, ocean marine and foreign trade, and title insurance policies.

          (2) No insurer shall cancel or refuse to renew the policy of the insured because of the termination of the agent's contract.

          (3) No insurer may cancel or amend a written agreement with an agent, or refuse to accept business from such agent, if the cancellation, amendment, or refusal is arbitrary, capricious, discriminatory under RCW 48.30.300, or based in whole or part upon the sex, race, creed, color, religion, national origin, or place of residency of the agent, his or her applicants, or policyholders.

          (4) Any insurer or agent accepting brokerage business who rejects the business of a broker shall provide upon request of the broker the reasons in writing for the rejection.

          (5) No insurer may cancel its agreement with an appointed agent with respect to insurance or refuse to accept insurance business from such agent unless it complies with the provisions of this section.