WSR 14-19-070
[Insurance Commissioner Matter No. R 2014-06Filed September 12, 2014, 3:42 p.m.]
Original Notice.
Preproposal statement of inquiry was filed as WSR 14-14-131.
Title of Rule and Other Identifying Information: FAIR plan.
Hearing Location(s): Insurance Commissioner's Office, 302 Sid Snyder Avenue S.W., Suite 200, Olympia, WA 98504-0258, on October 21, 2014, at 10:00 a.m.
Date of Intended Adoption: October 22, 2014.
Submit Written Comments to: Jim Tompkins, P.O. Box 40258, Olympia, WA 98504-0258, e-mail, fax (360) 586-3109, by October 20, 2014.
Assistance for Persons with Disabilities: Contact Lori [Lorie] Villaflores by October 20, 2014, TTY (360) 586-0241 or (360) 725-7087.
Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: The commissioner will consider rules amending WAC 284-19-140 regarding the composition of the governing committee of the FAIR plan.
Reasons Supporting Proposal: The current rules provide that two of the nine members of the governing committee of the FAIR plan are to be elected from the Alliance of American Insurers (AAI) and National Association of Independent Insurers (NAII), respectively. These two organizations have merged into the Property and Casualty Insurers Association of America (PCI) in 2014.
Statutory Authority for Adoption: RCW 48.02.060.
Statute Being Implemented: RCW 48.01.030.
Rule is not necessitated by federal law, federal or state court decision.
Name of Proponent: Mike Kreidler, insurance commissioner, governmental.
Name of Agency Personnel Responsible for Drafting and Implementation: Jim Tompkins, P.O. Box 40258, Olympia, WA 98504-0258, (360) 725-7036; and Enforcement: Jason Siems, P.O. Box 40258, Olympia, WA 98504-0258, (360) 725-7037.
No small business economic impact statement has been prepared under chapter 19.85 RCW. The entities that must comply with the proposed rule are not small businesses, pursuant to chapter 19.85 RCW.
A cost-benefit analysis is not required under RCW 34.05.328. This proposed rule revision amends WAC 284-19-140 to recognize changes in the organizational structure of the insurance industry association. The AAI and NAII merged into PCI in 2004. The AAI and NAII will be discontinued after 2014. The proposed revision reflects an administrative change only and does not represent a significant legislative change. No additional costs are expected to be incurred as a result of the proposed amendment. Therefore, under the provisions of RCW 34.05.328 (5)[(b)](iii), no cost-benefit analysis is required.
September 12, 2014
Mike Kreidler
Insurance Commissioner
AMENDATORY SECTION (Amending WSR 98-13-095, filed 6/16/98, effective 7/17/98)
WAC 284-19-140 Administration.
(1) This program shall be administered by a governing committee (referred to as the committee) of the facility, subject to the supervision of the commissioner, and operated by a manager appointed by the committee.
(2) The committee consists of nine members, including five insurers, ((one of which is)) elected from each of the following:
(a) American Insurance Association (one member);
(b) ((Alliance of American Insurers;)) Property Casualty Insurers Association of America (two members);
(c) ((National Association of Independent Insurers;
(d))) All other stock insurers (one member); and
(((e))) (d) All other nonstock insurers (one member).
A sixth member shall be an insurer designated as the service insurer under the program. The commissioner shall designate a sixth member if there is more than one service insurer. The other three members are individuals who are appointed by the commissioner to serve, none of whom have a direct or indirect interest in any insurer except as a policyholder. The individual members serve for a period of one year or until their successors are appointed. Not more than one insurer in a group under the same management or ownership shall serve on the committee at the same time. One of the six insurers on the governing committee shall be a domestic insurer.
(3) The governing committee may issue operating procedures and other directives to carry out the purposes of this plan and directives of the commissioner.
(4) Each person serving on the committee or any subcommittee, each member of the facility, and each officer and employee of the facility shall be indemnified by the facility against all costs and expenses actually and necessarily incurred in connection with the defense of any action, suit, or proceeding in which he or she is made a party by reason of being or having been a member of the committee, or a member or officer or employee of the facility except in relation to matters as to which he or she has been judged in such action, suit, or proceeding to be liable by reason of willful misconduct in the performance of duties as a member of the committee, or a member or officer or employee of the facility. This indemnification does not apply to any loss, cost, or expense on insurance policy claims under the program. Indemnification is not exclusive of other rights to which such member or officer may be entitled as a matter of law.