S-3973.1  _______________________________________________

                         SENATE BILL 6309

          _______________________________________________

State of Washington      54th Legislature     1996 Regular Session

By Senators Prentice, Winsley, Franklin, Swecker, Schow, Sheldon, Rasmussen, Bauer, Fraser, Oke and Fairley

Read first time 01/11/96.  Referred to Committee on Financial Institutions & Housing.

Giving a third party a direct cause of action against an insurer under certain circumstances.

    AN ACT Relating to insurance coverage for hazardous waste cleanups; and adding a new section to chapter 48.05 RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1.  A new section is added to chapter 48.05 RCW to read as follows:

    (1) Where an insurer has provided liability coverage for bodily injury or property damage caused by a release of hazardous substances and that coverage potentially would be available to compensate a third party or other entity, then that third party or other entity has a direct cause of action against the insurer.

    (2) Where an insurer has provided liability coverage for bodily injury or property damage caused by a release of hazardous substances and, but for a petition for relief granted under the bankruptcy code, the dissolution of a corporation, limited liability corporation, partnership or limited partnership, or death of a person, that coverage potentially would be available to compensate a third party or other entity, then that third party or other entity has a direct cause of action against the insurer of the debtor, dissolved corporation, limited liability corporation, partnership or limited partnership, or deceased person.  Nothing in this section may be interpreted to give rise to a cause of action against the bankrupt shareholders of a dissolved corporation or heirs of a deceased person.

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