H‑0421.1   _____________________________________________

HOUSE BILL 2224

           _____________________________________________

State of Washington      57th Legislature     2001 Regular Session

By Representatives Benson and Hatfield

Read first time 03/19/2001.  Referred to Committee on Financial Institutions & Insurance.

_1      AN ACT Relating to licensing specialty producers of certain

_2  lines of insurance; amending RCW 48.17.060; adding new sections to

_3  chapter 48.17 RCW; and prescribing penalties.

_4  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

_5      Sec. 1.  RCW 48.17.060 and 1995 c 214 s 1 are each amended to read

_6  as follows:

_7      (1) ((No)) A person ((shall)) in this state shall not act as or

_8  hold himself or herself out to be an agent, broker, solicitor,

_9  specialty producer, or adjuster unless then licensed therefor by

10  this state.

11      (2) ((No)) An agent, solicitor, or broker shall not solicit or

12  take applications for, procure, or place for others any kind of

13  insurance for which he or she is not then licensed.

14      (3) This section shall not apply with respect to any person

15  securing and forwarding information required for the purposes of

16  group credit life and credit disability insurance or credit

17  casualty insurance against loss or damage resulting from failure

18  of debtors to pay their obligations in connection with an

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_1  extension of credit and such other credit life and disability

_2  insurance or credit casualty insurance against loss or damage

_3  resulting from failure of debtors to pay their obligations as the

_4  commissioner shall determine, and where no commission or other

_5  compensation is payable on account of the securing and forwarding

_6  of such information.  However, the reimbursement of a creditor's

_7  actual expenses for securing and forwarding information required

_8  for the purposes of such group insurance shall not be considered a

_9  commission or other compensation if such reimbursement does not

10  exceed three dollars per certificate issued, or in the case of a

11  monthly premium plan extending beyond twelve months, not to exceed

12  three dollars per loan transaction revision per year.

13      (4) Any person violating this section shall be liable to a fine

14  of not to exceed five hundred dollars and imprisonment for not to

15  exceed six months for each instance of such violation.

16      NEW SECTION. Sec. 2.  A new section is added to chapter 48.17

17  RCW to read as follows:

18      (1) The commissioner shall issue to a person qualified under

19  this section a license to act as a specialty insurance producer

20  for one or more of the following lines of insurance only:  Credit

21  life, credit accident and health, credit involuntary unemployment,

22  credit property, or any other form of credit-related insurance

23  approved by the commissioner.  This section specifically permits the

24  sale of both group and individual insurance, in both single and

25  joint coverages, where applicable.  A licensee under this section

26  may receive commissions or other compensation for services

27  rendered in connection with the sale of credit insurance.

28      (2) For a specialty license to be issued under this section,

29  the applicant must submit to the commissioner all of the

30  following:

31      (a) A written application, signed by the applicant or where the

32  applicant is not an individual by an authorized representative, on

33  a form prescribed by the commissioner.  However, unless the

34  applicant is an individual, personal information regarding or

35  related to individuals shall not be required;

36      (b) A list of the physical locations where activities

37  authorized by this section will be conducted;

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_1      (c) If the applicant seeks to be licensed under a trade name,

_2  proof satisfactory to the commissioner that the trade name has

_3  been lawfully registered; and

_4      (d) The applicable fee set by the commissioner.

_5      (3) Except as provided in this section, an applicant for a

_6  license under this section shall be exempt from any prelicensing

_7  education, written examination, or continuing education

_8  requirements, and shall not be required to license any of its

_9  officers, directors, or employees individually.  An insurer's

10  appointment shall not be required to obtain a license under this

11  section.

12      (4) The specialty producer license shall be available equally

13  to residents and nonresidents, provided that if the laws or

14  regulations of another state would not reasonably permit a

15  licensed resident of this state to obtain an equivalent

16  nonresident license, then residents of that state shall not be

17  permitted to obtain specialty producer licenses as nonresidents

18  under this section.

19      (5) A specialty producer may not in any manner advertise,

20  represent, or otherwise hold out the licensee or any employee or

21  representative of the licensee as a licensed insurance agent under

22  another section of this chapter, unless the entity or individual

23  actually holds the applicable license.

24      (6) If a specialty producer violates this section or commits an

25  unfair trade practice or fraud as defined in this title, the

26  commissioner may, in accordance with applicable notice and hearing

27  requirements, impose any penalties the commissioner considers

28  necessary or appropriate to implement the purposes of this

29  section, including but not limited to placing the licensee on

30  probation, assessing an administrative penalty against the

31  licensee, reprimanding the licensee, suspending the transaction of

32  insurance at specific locations where a violation of this section

33  has occurred, or other penalty permitted under RCW 48.17.530.

34      (7) Except as provided in this section, a specialty producer is

35  not subject to this chapter.

36      NEW SECTION. Sec. 3.  A new section is added to chapter 48.17

37  RCW to read as follows:

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_1      A specialty producer license issued under section 2 of this act

_2  authorizes an employee or other representative of the licensee to

_3  participate in any aspect of selling the types of insurance for

_4  which the licensee has been authorized by the commissioner,

_5  without being licensed, registered, or otherwise individually

_6  identified, provided that all of the following applies:

_7      (1) The employee or representative operates with permission

_8  from and under the supervision of the licensee;

_9      (2) The employee or representative has been instructed by the

10  licensee with respect to the disclosures which may be required to

11  be made to consumers in connection with the sale of credit

12  insurance; and

13      (3) The employee or representative is not primarily compensated

14  based on the amount of insurance sold by the employee or

15  representative.

‑‑‑ END ‑‑‑

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