3052 AAS 3/6/98 S5298.1

HB 3052 - S COMM AMD

By Committee on Financial Institutions, Insurance & Housing

                                                    ADOPTED 3/6/98

    Strike everything after the enacting clause and insert the following:

    "NEW SECTION. Sec. 1.  (1) The legislature finds that protection of insurance consumers likely is enhanced by insurers' voluntary compliance with this state's insurance and other laws and that the public will benefit from incentives to identify and remedy insurance and other compliance issues.  One method to encourage insurers both to conduct voluntary internal audits of their compliance programs and management systems and to assess and improve compliance with state and federal statutes, rules, and orders, is to provide an insurance compliance self-evaluative privilege to protect the confidentiality of communications relating to voluntary internal compliance audits.  The legislature intends to study public policy issues regarding a limited privilege to encourage voluntary compliance and improve insurance market conduct quality, and whether the expanded privilege could inhibit the exercise of the regulatory authority by those entrusted with protecting insurance consumers.

    (2) The house financial institutions and insurance committee and the senate financial institutions, insurance and housing committee shall jointly study insurance compliance self-evaluative audits and make recommendations on whether a limited privilege should be authorized in Washington state to encourage such audits.  The chairs of the two committees shall oversee the study.  If the recommendations include authorizing the limited privilege, the study shall develop a bill for consideration in the 1999 legislative session.

    (3) The two committee chairs shall organize a study group that includes the voluntary participation of the insurance industry, the office of the insurance commissioner, and other interested parties.  The ranking minority members of each committee shall also participate in the study group.

    (4) The house office of program research and senate committee services shall staff the study group.

    (5) The recommendations of the study group are due by December 31, 1998.  This section expires January 1, 1999."

HB 3052 - S COMM AMD

By Committee on Financial Institutions, Insurance & Housing

                                                    ADOPTED 3/6/98

    On page 1, line 1 of the title, after "insurers;" strike the remainder of the title and insert "creating a new section; and providing an expiration date."

                            --- END ---