S-3974.1  _______________________________________________

                         SENATE BILL 6310

          _______________________________________________

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.

Requiring an insurer to provide an insured independent counsel when the insurer reserves the right to refuse to indemnify the policyholder for injury caused by the release of a hazardous substance.

    AN ACT Relating to insurance coverage for hazardous waste cleanups; and adding a new section to chapter 48.30 RCW.

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

NEW SECTION. Sec. 1.  A new section is added to chapter 48.30 RCW to read as follows:

    If an insurance policy imposes a duty to defend on the insurer, and the insurer reserves its right to deny its duty to indemnify the policyholder for bodily injury or property damage caused by a release of a hazardous substance, then there is a conflict of interest between the insurer and the policyholder that the insurer must disclose to the policyholder, and the policyholder is entitled to select independent counsel to defend it at the expense of the insurer.

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