Title of Rule and Other Identifying Information: WAC 284-24-120 (6)(c), corrects the definition of motor vehicle
service contract reimbursement insurance in the regulation
providing for suspension of filing requirements for large
commercial accounts to match a newly-enacted law.
THIS RULE IS BEING PROPOSED UNDER AN EXPEDITED RULE-MAKING PROCESS THAT WILL ELIMINATE THE NEED FOR THE AGENCY TO HOLD PUBLIC HEARINGS, PREPARE A SMALL BUSINESS ECONOMIC IMPACT STATEMENT, OR PROVIDE RESPONSES TO THE CRITERIA FOR A SIGNIFICANT LEGISLATIVE RULE. IF YOU OBJECT TO THIS USE OF THE EXPEDITED RULE-MAKING PROCESS, YOU MUST EXPRESS YOUR OBJECTIONS IN WRITING AND THEY MUST BE SENT TO Kacy Scott, Office of the Insurance Commissioner, P.O. Box 40255, Olympia, WA 98504-0258, fax (360) 586-3109, e-mail KacyS@oic.wa.gov , AND RECEIVED BY April 10, 2007.
Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: This proposed rule will correct the definition of "motor vehicle service contract reimbursement insurance" in the regulation providing for suspension of filing requirements for large commercial accounts.
Reasons Supporting Proposal: Chapter 48.96 RCW was repealed under SHB 2553 during the 2006 legislative session. This rule making will correct an out-of-date reference to the definition of motor vehicle service contract reimbursement insurance in WAC 284-24-120.
Statutory Authority for Adoption: RCW 48.02.060 and 48.19.080.
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: Lee Barclay, P.O. Box 40255, Olympia, WA 98504, (360) 725-7115; Implementation: Beth Berendt, P.O. Box 40255, Olympia, WA 98504, (360) 725-7117; and Enforcement: Carol Sureau, P.O. Box 40255, Olympia, WA 98504, (360) 725-7050.
February 7, 2007
AMENDATORY SECTION(Amending Matter No. R 2003-04, filed 12/23/03, effective 1/23/04)
WAC 284-24-120 Suspension of rate filing requirements -- Large commercial accounts. (1) Under RCW 48.19.080, the rate filing requirements in chapter 48.19 RCW are suspended with respect to large commercial property casualty accounts.
(2) For purposes of this section, "large commercial property casualty account" means insurance coverage that:
(a) Involves the lines of property and casualty insurance defined in RCW 48.11.040, 48.11.050, 48.11.060, 48.11.070, and/or 48.11.080; and
(b) Is purchased by a business, not-for-profit organization, or public entity with enough insurance buying experience to negotiate with insurers in a largely unregulated environment and that meets any two of the following criteria:
(i) Annual premiums of one hundred thousand dollars or more, excluding workers compensation insurance issued by the department of labor and industries and types of insurance listed in subsection (6) of this section;
(ii) Net revenues or sales in excess of one hundred million dollars;
(iii) More than two hundred employees;
(iv) Net worth over fifty million dollars;
(v) Is a not-for-profit organization or public entity with an annual budget or assets of at least forty-five million dollars;
(vi) Is a municipality with a population over fifty thousand.
(3) Before an insurer issues coverage in reliance on this section, the insurer or its agent shall notify the insured in writing that the rates have not been and will not be filed for the commissioner's approval.
(4) Property rates used on large commercial property casualty accounts will not be audited by the Washington Insurance Examining Bureau under WAC 284-20-006.
(5) The commissioner retains the right and ability to examine the rates used on large commercial property casualty accounts to ascertain whether they meet the requirements of RCW 48.19.020 and other statutes. The insurer shall maintain records supporting the rating and premium determination of each policy issued in reliance on this section. These records shall be retained by the insurer for a minimum of three years and made available at all reasonable times for the commissioner's examination.
(6) Subsection (1) of this section does not apply to:
(a) Professional liability insurance, including medical malpractice insurance;
(b) Directors' and officers' liability insurance purchased by individuals;
Motor vehicle service contract reimbursement
insurance, as defined in RCW 48.96.010(4); and)) Reimbursement
insurance policies that reimburse service contract providers
or protection product guarantee providers for contractual
obligations assumed under a service contract or protection
product guarantee; and
(d) Master policies under which certificates of coverage are issued to individual consumers, households, businesses, or other organizations.
[Statutory Authority: RCW 48.02.060, 48.18.100(6), and 48.19.080. 04-01-175 (Matter No. R 2003-04), § 284-24-120, filed 12/23/03, effective 1/23/04. Statutory Authority: RCW 48.02.060, 48.18.100, 48.19.080. 02-02-068 (Order R 2001-09), § 284-24-120, filed 12/28/01, effective 12/31/01. Statutory Authority: RCW 48.02.060 and 48.19.080. 99-23-068 (Matter No. R 99-5), § 284-24-120, filed 11/15/99, effective 12/16/99.]