BILL REQ. #:  H-1209.1 

Read first time 02/04/2005.   Referred to Committee on Financial Institutions & Insurance.

     AN ACT Relating to homeowners' insurance; and adding a new section to chapter 48.18 RCW.

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

NEW SECTION.  Sec. 1   A new section is added to chapter 48.18 RCW to read as follows:
     (1) For the purposes of this section:
     (a) "Adverse action" has the same meaning as defined in the fair credit reporting act, 15 U.S.C. Sec. 1681 et seq. Adverse actions include, but are not limited to the following:
     (i) Cancellation, denial, or nonrenewal of homeowners' insurance coverage;
     (ii) Charging a higher insurance premium for homeowners' insurance than would have been charged if the information from the consumer reporting organization had been more favorable, whether the charge is by any of the following:
     (A) Application of a rating rule;
     (B) Assignment to a rating tier that does not have the lowest available rates; or
     (C) Placement with an affiliate company that does not offer the lowest rates available to the consumer within the affiliate group of insurance companies; or
     (iii) Any reduction, adverse, or unfavorable change in the terms of coverage or amount of any homeowners' insurance due to information received from a consumer reporting organization, including the following:
     (A) Coverage provided to the consumer is not as broad in scope as coverage requested by the consumer but available to other insureds of the insurer or any affiliate; or
     (B) The consumer is not eligible for benefits such as dividends that are available through affiliate insurers.
     (b) "Affiliate" has the same meaning as defined in RCW 48.31B.005(1).
     (c) "Consumer" means an individual policyholder or applicant for insurance.
     (d) "Consumer reporting organization" means an organization that operates a data base, which is populated primarily by information provided by insurance institutions.
     (e) "Homeowners' insurance coverage" includes residential homeowners', mobile homeowners', manufactured homeowners', condominium owners', and renters' coverage.
     (f) "Tier" means a category within a single insurer into which insureds with substantially like insuring, risk or exposure factors, and expense elements are placed for purposes of determining rate or premium.
     (2) When an insurer takes adverse action against an insured, the insurer may consider the following only in combination with other substantive underwriting factors: The fact that an individual has previously inquired about the nature or scope of coverage under a homeowners' insurance policy when:
     (a) The information about this inquiry was received from the insured's records or from a consumer reporting organization; and
     (b) The inquiry did not result in the filing of a claim.