WSR 14-14-130 PREPROPOSAL STATEMENT OF INQUIRY OFFICE OF INSURANCE COMMISSIONER [Insurance Commissioner Matter No. R 2014-05—Filed July 2, 2014, 10:22 a.m.]
Subject of Possible Rule Making: To establish rules for investment in hedging and income generation derivative transactions by insurers and approval by the commissioner of derivative use plans of insurers.
Statutes Authorizing the Agency to Adopt Rules on this Subject: RCW 48.02.060 and 48.13.171.
Reasons Why Rules on this Subject may be Needed and What They Might Accomplish: RCW 48.13.091 provides little guidance on derivative investments other than prohibiting the use of derivatives instruments for any purpose other than hedging or income generation purposes. This lack of guidance increases the risk of domestic insurer insolvency and complicates the protection of Washington state policyholders.
The commissioner will consider rules that conform with his mission to protect consumers, the public interest, and the state's economy by establishing standards for the prudent use of derivative instruments under RCW 48.13.091.
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 15, 2014, to Jim Tompkins, P.O. Box 40258, Olympia, WA 98504-0258, e-mail rulescoordinator@oic.wa.gov, fax (360) 586-3109.
Interested parties can participate in the decision to adopt the new rule and formulation of the proposed rule before publication by contacting Jim Tompkins, P.O. Box 40258, Olympia, WA 98504-0258, e-mail rulescoordinator@oic.wa.gov, fax (360) 586-3109.
July 2, 2014
Mike Kreidler
Insurance Commissioner
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