SENATE BILL REPORT

SHB 1638

This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent.

As Reported by Senate Committee On:

Financial Institutions, Housing & Insurance, March 28, 2013

Title: An act relating to insurance.

Brief Description: Addressing insurance, generally.

Sponsors: House Committee on Business & Financial Services (originally sponsored by Representatives Ryu, Kirby, Cody and Morrell; by request of Insurance Commissioner).

Brief History: Passed House: 3/08/13, 72-26.

Committee Activity: Financial Institutions, Housing & Insurance: 3/21/13, 3/28/13 [DP].

SENATE COMMITTEE ON FINANCIAL INSTITUTIONS, HOUSING & INSURANCE

Majority Report: Do pass.

Signed by Senators Hobbs, Chair; Mullet, Vice Chair; Benton, Ranking Member; Fain, Hatfield, Nelson and Roach.

Staff: Edward Redmond (786-7471)

Background: The Office of the Insurance Commissioner (OIC) is authorized to regulate all insurance business in Washington, including certification of various types of insurers, approval of rate and form contracts, licensing of agents and brokers, collection of premium taxes, and responding to consumer complaints.

The Revised Code of Washington is periodically updated and clarified by the various state agencies responsible for its implementation. This clean-up process eliminates obsolete language, makes minor substantive or technical changes, and repeals outdated sections. This is OIC's clean-up bill.

Summary of Bill: Numerous provisions of the insurance code are modernized and clarified, internal cross-references are corrected, and minor substantive or technical changes are made, including the following:

Appropriation: None.

Fiscal Note: Available.

Committee/Commission/Task Force Created: No.

Effective Date: Ninety days after adjournment of session in which bill is passed.

Staff Summary of Public Testimony: PRO: The insurance code is complex and there are changes that OIC needs to make in order to keep pace with federal and state policy. This bill makes changes to property and casualty laws and to the health care provisions the state adopted last year in response to the federal requirements. Regence Blue Shield is in support of this bill. The bill corrects a few issues with the law that was implemented last year. Specifically, the bill makes sure the market rules associated with the non-exchange market only apply to the correct lines of business and the actuarial value provisions in the Affordable Care Act only apply to the correct lines of business. The health care amendments in the bill were requested by the health care industry.

Persons Testifying: PRO: Senator Ryu, prime sponsor; Drew Bouton, OIC; Chris Bandoli, Regence Blue Shield.