PROPOSED RULES
INSURANCE COMMISSIONER
Original Notice.
Preproposal statement of inquiry was filed as WSR 12-10-080.
Title of Rule and Other Identifying Information: Office of the insurance commissioner (OIC) contact information in notices regarding policy changes for personal injury protection (PIP) and the FAIR plan.
Hearing Location(s): Insurance Commissioner's Office, TR 120, 5000 Capitol Boulevard, Tumwater, WA 98504-0255, on August 27, 2012, at 10:00 a.m.
Date of Intended Adoption: August 31, 2012.
Submit Written Comments to: Kacy Scott, P.O. Box 40258, Olympia, WA 98504-0258, e-mail kacys@oic.wa.gov, fax (360) 586-3109, by August 24, 2012.
Assistance for Persons with Disabilities: Contact Lorrie [Lorie] Villaflores by August 24, 2012, TTY (360) 586-0241 or (360) 725-7087.
Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: Insurers are currently required to provide written notification to their insureds in the following two situations:
| • | WAC 284-19-110 FAIR plan - cancellation or nonrenewal. |
| • | WAC 284-30-395(1) PIP - Within a reasonable time after receipt of actual notice of an insured's intent to file a personal injury protection medical and hospital benefits claim, and in every case prior to denying or terminating an insured's medical and hospital benefits. |
Reasons Supporting Proposal: The inclusion of OIC contact information in the PIP and FAIR plan notices will provide an avenue for assistance to consumers when they most need help: When they are injured in an auto accident or when their property insurance has been cancelled. Many consumers are unaware of the OIC assistance that is available to them to answer insurance questions and resolve problems.
Statutory Authority for Adoption: RCW 48.02.060 and 48.22.105.
Statute Being Implemented: RCW 48.22.085 and 48.58.010.
Rule is not necessitated by federal law, federal or state court decision.
Name of Proponent: Mike Kreidler, insurance commissioner, governmental.
Name of Agency Personnel Responsible for Drafting: Kacy Scott, P.O. Box 40258, Olympia, WA 98504-0258, (360) 725-7041; Implementation: John Hamje, P.O. Box 40255, Olympia, WA 98504-0255, (360) 725-7262; and Enforcement: Carol Sureau, P.O. Box 40255, Olympia, WA 98504-0255, (360) 725-7050.
No small business economic impact statement has been prepared under chapter 19.85 RCW. There is no significant cost imposed by this proposed regulatory amendment on any business; these proposed amendments to the standards for personal injury protection settlements and the FAIR plan rules simply require that a written explanation of coverage provided by an insurer to the insured or a notice of cancellation/refusal to renew must include contact information for the commissioner's consumer protection services and a statement that the insured may contact that office for assistance with questions or complaints. Including this information in these documents will require a minimal amount of clerical time and is unlikely to add any noticeable costs for either paper or postage.
A cost-benefit analysis is required under RCW 34.05.328. A preliminary cost-benefit analysis may be obtained by contacting Kacy Scott, P.O. Box 40258, Olympia, WA 98504-0258, phone (360) 725-7041, fax (360) 586-3109, e-mail kacys@oic.wa.gov.
July 18, 2012
Mike Kreidler
Insurance Commissioner
OTS-4847.1
AMENDATORY SECTION(Amending Matter No. R 98-10, filed
6/16/98, effective 7/17/98)
WAC 284-19-170
Public education and notices required.
(1) All insurers shall undertake a continuing public education
program in cooperation with producers and others, to assure
that the program receives adequate public attention.
(2) All insurers terminating a property insurance policy shall give any policyholder eligible for coverage under this program notice of cancellation or refusal to renew as required under chapters 48.18 and 48.53 RCW. The insurers shall explain the procedure for making application under this program in or accompanying the notice. A notice of cancellation or refusal to renew must include contact information for the office of the Washington state insurance commissioner's consumer protection services, including the consumer protection division's hotline phone number and the agency's web site address, and a statement that the consumer may contact the office of the insurance commissioner for assistance with questions or complaints.
[Statutory Authority: RCW 48.02.060. 98-13-095 (Matter No. R 98-10), § 284-19-170, filed 6/16/98, effective 7/17/98; Order R 77-1, § 284-19-170, filed 3/24/77; Order R-69-1, § 284-19-170, filed 1/28/69.]
OTS-4848.2
AMENDATORY SECTION(Amending Matter No. R 96-6, filed 6/5/97,
effective 7/6/97)
WAC 284-30-395
Standards for prompt, fair and equitable
settlements applicable to automobile personal injury
protection insurance.
The commissioner finds that some
insurers limit, terminate, or deny coverage for personal
injury protection insurance without adequate disclosure to
insureds of their bases for such actions. To eliminate unfair
acts or practices in accord with RCW 48.30.010, the following
are hereby defined as unfair methods of competition and unfair
or deceptive acts or practices in the business of insurance
specifically applicable to automobile personal injury
protection insurance. The following standards apply to an
insurer's consultation with health care professionals when
reviewing the reasonableness or necessity of treatment of the
insured claiming benefits under his or her automobile personal
injury protection benefits in an automobile insurance policy,
as those terms are defined in RCW 48.22.005 (1), (7), and (8),
and as prescribed at RCW 48.22.085 through 48.22.100. This
section applies only where the insurer relies on the medical
opinion of health care professionals to deny, limit, or
terminate medical and hospital benefit claims. When used in
this section, the term "medical or health care professional"
does not include an insurer's claim representatives,
adjusters, or managers or any health care professional in the
direct employ of the insurer.
(1) Within a reasonable time after receipt of actual notice of an insured's intent to file a personal injury protection medical and hospital benefits claim, and in every case prior to denying, limiting, or terminating an insured's medical and hospital benefits, an insurer shall provide an insured with a written explanation of the coverage provided by the policy, including a notice that the insurer may deny, limit, or terminate benefits if the insurer determines that the medical and hospital services:
(a) Are not reasonable;
(b) Are not necessary;
(c) Are not related to the accident; or
(d) Are not incurred within three years of the automobile accident.
These are the only grounds for denial, limitation, or termination of medical and hospital services permitted pursuant to RCW 48.22.005(7), 48.22.095, or 48.22.100.
The written explanation must include contact information for the office of the Washington state insurance commissioner's consumer protection services, including the consumer protection division's hotline phone number and the agency's web site address, and a statement that the consumer may contact the office of the insurance commissioner for assistance with questions or complaints.
(2) Within a reasonable time after an insurer concludes that it intends to deny, limit, or terminate an insured's medical and hospital benefits, the insurer shall provide an insured with a written explanation that describes the reasons for its action and copies of pertinent documents, if any, upon request of the insured. The insurer shall include the true and actual reason for its action as provided to the insurer by the medical or health care professional with whom the insurer consulted in clear and simple language, so that the insured will not need to resort to additional research to understand the reason for the action. A simple statement, for example, that the services are "not reasonable or necessary" is insufficient.
(3)(a) Health care professionals with whom the insurer will consult regarding its decision to deny, limit, or terminate an insured's medical and hospital benefits shall be currently licensed, certified, or registered to practice in the same health field or specialty as the health care professional that treated the insured.
(b) If the insured is being treated by more than one health care professional, the review shall be completed by a professional licensed, certified, or registered to practice in the same health field or specialty as the principal prescribing or diagnosing provider, unless otherwise agreed to by the insured and the insurer. This does not prohibit the insurer from providing additional reviews of other categories of professionals.
(4) To assist in any examination by the commissioner or the commissioner's delegatee, the insurer shall maintain in the insured's claim file sufficient information to verify the credentials of the health care professional with whom it consulted.
(5) An insurer shall not refuse to pay expenses related to a covered property damage loss arising out of an automobile accident solely because an insured failed to attend, or chose not to participate in, an independent medical examination requested under the insured's personal injury protection coverage.
(6) If an automobile liability insurance policy includes an arbitration provision, it shall conform to the following standards:
(a) The arbitration shall commence within a reasonable period of time after it is requested by an insured.
(b) The arbitration shall take place in the county in which the insured resides or the county where the insured resided at the time of the accident, unless the parties agree to another location.
(c) Relaxed rules of evidence shall apply, unless other rules of evidence are agreed to by the parties.
(d) The arbitration shall be conducted pursuant to arbitration rules similar to those of the American Arbitration Association, the Center for Public Resources, the Judicial Arbitration and Mediation Service, Washington Arbitration and Mediation Service, chapter 7.04 RCW, or any other rules of arbitration agreed to by the parties.
[Statutory Authority: RCW 48.02.060, 48.22.105 and 48.30.010. 97-13-005 (Matter No. R 96-6), § 284-30-395, filed 6/5/97, effective 7/6/97.]