Subject of Possible Rule Making: Insurer's use of legal name when transacting business, pursuant to RCW 48.05.190.

     Statutes Authorizing the Agency to Adopt Rules on this Subject: RCW 48.02.060.

     Reasons Why Rules on this Subject may be Needed and What They Might Accomplish: Since 1947, when RCW 48.05.190 and 48.30.050 were enacted, the legal structure of insurance companies has changed. Many insurers are affiliates of holding company systems that use a group name to identify the various insurance companies in the holding company system. If the legal name of the insurance company involved in a particular matter is not accurately and completely identified, consumers and the office of insurance commissioner can be misled or confused, and unnecessarily expend time and money trying to identify the correct company related to a transaction. It is important that insurers use their correct legal name in all insurance transactions.

     In a series of technical advisory announcements issued between 1978 and 2000, the commissioner explained aspects of compliance with RCW 48.05.190 and 48.30.050, which requires insurers to use their legal name when transacting business and advertising. In 2010, the commissioner adopted a rule that included the technical advisory information, and further explained how insurers were expected to operate to comply with the statutes. After the adoption of WAC 284-30-670, some property and casualty insurers and some producers informed the commissioner that implementing the new rule would be difficult. The commissioner issued an emergency rule in response to the insurer's implementation concerns.

     This rule making will finalize compliance standards for insurers related to RCW 48.05.190 and 48.30.050. Under this rule making, the commissioner will work with impacted industry to ensure that the rule provides necessary consumer protection, supports the commissioner's market oversight, and minimizes the operational burden on insurers.

     Other Federal and State Agencies that Regulate this Subject and the Process Coordinating the Rule with These Agencies: None.

     Process for Developing New Rule: Submit written comments by August 23, 2010, to Kacy Scott, P.O. Box 40258, Olympia, WA 98504-0258, kacys@oic.wa.gov.

     Interested parties can participate in the decision to adopt the new rule and formulation of the proposed rule before publication. To ensure that all implementation issues are considered, please submit written comments by August 23, 2010, to Kacy Scott, P.O. Box 40258, Olympia, WA 98504-0258, kacys@oic.wa.gov.

July 6, 2010

Mike Kreidler

Insurance Commissioner

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