S-1228.2 _______________________________________________
SENATE BILL 5823
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State of Washington 52nd Legislature 1991 Regular Session
By Senators West, Sutherland, Owen, Sellar and Matson.
Read first time February 22, 1991. Referred to Committee on Financial Institutions & Insurance.
AN ACT Relating to insurance rates; and adding new sections to chapter 48.19 RCW.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
NEW SECTION. Sec. 1. A new section is added to chapter 48.19 RCW to read as follows:
The purposes of this chapter are to:
(1) Promote price competition among insurers;
(2) Protect policyholders and the public against adverse effects of excessive, inadequate, or unfairly discriminatory rates;
(3) Authorize essential cooperative activities among insurers in the ratemaking process and to regulate such activities to prohibit practices that tend to substantially lessen competition or create monopolies; and
(4) Provide necessary regulatory authority in the absence of a competitive marketplace.
NEW SECTION. Sec. 2. A new section is added to chapter 48.19 RCW to read as follows:
(1) A competitive market is presumed to exist unless the commissioner, after notice and hearing, determines that competition does not exist within a market and issues a ruling to that effect. The ruling shall expire one year after issue unless rescinded earlier by the commissioner.
(2)(a) The commissioner shall consider all relevant structural factors in determining the competitiveness of the market, including but not limited to: The number of insurers actively engaged in providing coverage in the state; market shares; changes in market shares; and ease of entry into the market in the state.
(b) An insurer shall not be required to report information to the commissioner on a basis inconsistent with its rating plan.
NEW SECTION. Sec. 3. A new section is added to chapter 48.19 RCW to read as follows:
(1) The commissioner shall disapprove a rate for use in a competitive market only if the commissioner finds that the rate is inadequate.
(2) The commissioner may disapprove a rate for use in a noncompetitive market only if the commissioner finds that the rate is excessive, inadequate, or unfairly discriminatory.