WSR 16-01-024 PERMANENT RULES OFFICE OF
INSURANCE COMMISSIONER
[Insurance Commissioner Matter No. R 2015-07—Filed December 7, 2015, 2:56 p.m., effective January 7, 2016] Effective Date of Rule: Thirty-one days after filing.
Purpose: In August 2014 the commissioner adopted rules providing guidance to insurance producers as to what may or may not constitute sharing of commissions with nonlicensed persons. During the 2015 legislative session, legislation (ESSB 5743) was enacted that amended some of the statutes regarding what constitutes rebates and inducements, which impacts the rules adopted by the commissioner in 2014. Therefore, these rules amend the 2014 rules (by repeal and adoption of new sections) to conform to the legislation.
Citation of Existing Rules Affected by this Order: Repealing WAC 284-17-800, 284-17-820, and 284-17-830.
Other Authority: RCW 48.17.490.
Adopted under notice filed as WSR 15-21-049 on October 16, 2015.
A final cost-benefit analysis is available by contacting Jim Tompkins, P.O. Box 40260, Olympia, WA 98504-0260, phone (360) 725-7036, fax (360) 586-3109, e-mail rulescoordinator@oic.wa.gov.
Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 3, Amended 0, Repealed 3.
Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.
Number of Sections Adopted on the Agency's Own Initiative: New 3, Amended 0, Repealed 3.
Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.
Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 3, Amended 0, Repealed 3.
Date Adopted: December 6, 2015.
Mike Kreidler
Insurance Commissioner
NEW SECTION
WAC 284-17-805 Charitable contributions.
(1) An insurance producer may pay or assign all or a portion of a commission, fee, or other consideration received in connection with the sale, solicitation, or negotiation of insurance to a bona fide charitable or nonprofit organization as defined in chapter 48.30 RCW if all of the following conditions are met:
(a) The insured or prospective insured has no influence over which bona fide charitable or nonprofit organization receives the payment or assignment;
(b) The payment or assignment is not made in the insured's or prospective insured's name;
(c) The insured or prospective insured is not entitled to a tax benefit for the payment or assignment; and
(d) The insured or prospective insured does not select or influence the selection of the person or persons who benefit from the bona fide charitable or nonprofit organization.
(2) An insurance producer may sponsor events for, or make contributions to a bona fide charitable or nonprofit organization if the sponsorship or contribution is not conditioned upon any person affiliated with or interested in the bona fide charitable or nonprofit organization applying for or obtaining insurance through the insurance producer.
(3) An insurance producer may not sponsor events for or make contributions to a bona fide charitable or nonprofit organization if the sponsorship or contribution is conditioned upon the referral of insurance business to the insurance producer or endorsement of the insurance producer or insurance product by the bona fide charitable or nonprofit organization.
NEW SECTION
WAC 284-17-825 Referrals.
(1) An unlicensed individual who receives referral compensation under RCW 48.30.133(1) or a referral fee under RCW 48.30.133(4) is not selling, soliciting, or negotiating insurance if all of the following conditions are met:
(a) The referral compensation or fee does not depend upon whether the referral results in a purchase or sale;
(b) If insurance is purchased, the purchase is not a factor in determining the value of the referral compensation or the amount of the referral fee; and
(c) The recipient of the referral compensation or fee does not make representations to the prospective insured about the terms of or specific need for a policy.
(2) Referral compensation given to an individual under RCW 48.30.133(1) is limited to no more than one hundred dollars in value per referring individual in any consecutive twelve-month period.
NEW SECTION
WAC 284-17-835 Promotional games of chance.
An insurance producer may conduct a promotional game of chance provided that:
(1) The promotional game of chance is undertaken solely for the purpose of advertising and promoting the insurance producer;
(2) No person eligible to receive the prize is required to apply for insurance, purchase insurance, refer a person to the insurance producer, or pay any other consideration to enter the promotional game of chance;
(3) The promotional game of chance is open to the general public;
(4) The value of the prize is limited to one hundred dollars in value;
(5) No person receives a total of prizes exceeding one hundred dollars in value in the aggregate in any consecutive twelve-month period from the insurance producer; and
(6) The promotional game of chance complies with chapter 9.46 RCW and any and all other applicable Washington state statutes and rules.
REPEALER
The following sections of the Washington Administrative Code are repealed:
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