HOUSE BILL REPORT

                  SB 6396

             As Reported By House Committee on:

             Financial Institutions & Insurance

Title:  An act relating to persons making contracts of insurance with unauthorized insurance providers.

Brief Description:  Making certain unauthorized insurance brokers personally liable for contracts of insurance.

Sponsor(s):  Senators von Reichbauer, Pelz, Erwin, Moore, Vognild and Conner.

Brief History:

  Reported by House Committee on:

Financial Institutions & Insurance, February 25, 1992, DP.

HOUSE COMMITTEE ON

FINANCIAL INSTITUTIONS & INSURANCE

Majority Report: Do pass.  Signed by 9 members:  Representatives Dellwo, Chair; Broback, Ranking Minority Member; Mielke, Assistant Ranking Minority Member; Anderson; Inslee; R. Johnson; Paris; Schmidt; and Winsley.

Staff:  John Conniff (786-7119).

Background:  Insurance companies must obtain a certificate of authority to transact business within the state. Insurance companies without such a certificate are unauthorized insurers.  Under limited circumstances, an unauthorized insurance company may provide insurance for risks within the state.  However, such insurance may only be procured or provided through a properly licensed surplus lines broker.

Summary of Bill:  A person, other than a duly licensed surplus line broker acting in good faith under his or her license, who makes a contract of insurance on behalf of an unauthorized insurer is personally liable for the performance of the contract.

Fiscal Note:  Not requested.

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

Testimony For:  None.

Testimony Against:  None.

Witnesses:  None.