CERTIFICATION OF ENROLLMENT

                        HOUSE BILL 1727

                    Chapter 90, Laws of 2001

                        57th Legislature

                2001 Regular Legislative Session

INSURERS--INVESTMENT LIMITS

                    EFFECTIVE DATE:  7/22/01

Passed by the House March 9, 2001   Yeas 98   Nays 0               FRANK CHOPP Speaker of the House of Representatives              CLYDE BALLARD Speaker of the House of Representatives Passed by the Senate April 6, 2001   Yeas 48   Nays 0

CERTIFICATE We, Timothy A. Martin and Cynthia Zehnder, Co-Chief Clerks of the House of Representatives of the State of Washington, do hereby certify that the attached is HOUSE BILL 1727  as passed by the House of Representatives and the Senate on the dates hereon set forth.            CYNTHIA ZEHNDER                           Chief Clerk           TIMOTHY A. MARTIN                           Chief Clerk

BRAD OWEN President of the Senate

Approved April 19, 2001 Place Style On Codes above, and Style Off Codes below.	FILED                            April 19, 2001 - 5:04 p.m.
GARY LOCKE Governor of the State of Washington	Secretary of State                  State of Washington

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                          HOUSE BILL 1727

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             Passed Legislature - 2001 Regular Session

State of Washington      57th Legislature     2001 Regular Session

By Representatives Roach, Miloscia, Benson and Hatfield; by request of Insurance Commissioner

Read first time 02/01/2001.  Referred to Committee on Financial Institutions & Insurance.

Regulating the investment limits of insurers in noninsurance subsidiaries. 

    AN ACT Relating to the investment limits of insurers in noninsurance subsidiaries; and adding a new section to chapter 48.13 RCW.

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

NEW SECTION. Sec. 1.  A new section is added to chapter 48.13 RCW to read as follows:

    (1) Notwithstanding RCW 48.13.220 and 48.13.240, an insurer may not loan or invest its funds in common stock, preferred stock, debt obligations, and other securities of one or more subsidiaries in an aggregate amount exceeding the lesser of the following sums:  Ten percent of its assets, or fifty percent of its surplus as regards policyholders.  In calculating the amount of investments under this section, investments in domestic or foreign subsidiary insurers, health care service contractors, and health maintenance organizations are excluded.

    (2) For the purposes of this section, "subsidiary" has the same meaning as in RCW 48.31B.005.

    Passed the House March 9, 2001.

    Passed the Senate April 6, 2001.

Approved by the Governor April 19, 2001.

    Filed in Office of Secretary of State April 19, 2001.