S-1136               _______________________________________________

                                                   SENATE BILL NO. 5446

                        _______________________________________________

State of Washington                              50th Legislature                              1987 Regular Session

By Senators Halsan, Metcalf, Bottiger and Vognild

Read first time 1/30/87 and referred to Committee on Financial Institutions.

AN ACT Relating to insurance; and adding a new section to chapter 48.18 RCW.

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

NEW SECTION. Sec. 1.  A new section is added to chapter 48.18 RCW to read as follows:

          Upon cancellation by the insurer of any policy providing property and casualty insurance for commercial purposes, the insurer shall pay to the insured that portion of any premium paid to the insurer on account of the policy, unearned because of the cancellation, computed on a pro rata basis.  In addition to any unearned portion of any premium, the insurer shall pay an amount of ten percent of any unearned portion not exceeding one hundred dollars or five percent of any unearned portion over one hundred dollars but not exceeding five hundred dollars, or three percent of any unearned portion exceeding five hundred dollars.  This additional amount shall not be paid if cancellation is due to nonpayment of premiums, fraud, misrepresentation, or a material change in the condition affecting the risk.  If the amount of any refund is less than two dollars, no refund need be made.  Amounts due shall be actually paid to the insured or other person entitled to them as shown by the policy or by any endorsement on it, or be mailed to the insured or such person as soon as possible, and no later than forty-five days after the date of notice of cancellation to the insured.  Any such payment may be made by cash, or by check, bank draft, or money order.

          Property and casualty insurance for commercial purposes includes but is not limited to business liability, fire, theft, and vandalism insurance, but does not include private passenger auto insurance.