Senate Bill Report SB 6144, Implementation Credits and Performance Standards (January 17, 2020)
Summary
Senate Bill Report on SB 6144, as of January 17, 2020, for the Senate Committee on Financial Institutions, Economic Development & Trade, which lists committee activity on 1/21/20. The bill concerns implementation credits and performance standards, with Senators Hasegawa and Das as sponsors, by request of Insurance Commissioner. The summary of the bill states that insurers are directed to describe implementation credits provided to a policy holder and file the policy with the commissioner, and limits the credits by lives covered, at $1 million for 1000 or more lives and $50,000 for less than 50 lives. It states that the insurance commissioner is provided rulemaking authority, with appropriation none and an effective date of July 1, 2020.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
- Issuer
- Congressional materials
- Document type
- Report
- Date
- 2020-01-21
- Case
- 2020 01 21 A26305 D209463 Bill Report 6144 Sba Fiet
Cite this document
“Senate Bill Report SB 6144, Implementation Credits and Performance Standards (January 17, 2020).”
Original at app.leg.wa.gov, dated 2020-01-21. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2020-01-21-2020-01-21-a26305-d209463-bill-report-6144-sba-fiet/
, SHA-256 2daf48fcb9d0676a8a8c14a8dfb62f15020fc09380368f35ce31e258e011d3be.Full text
SENATE BILL REPORT
SB 6144
As of January 17, 2020
Title: An act relating to implementation credits and performance standards.
Brief Description: Concerning implementation credits and performance standards.
Sponsors: Senators Hasegawa and Das; by request of Insurance Commissioner.
Brief History:
Committee Activity: Financial Institutions, Economic Development & Trade: 1/21/20.
Brief Summary of Bill
Creates regulatory structure for implementation credits.
Limits the amount of implementation credits an insurer can provide to a
group policyholder based on the number of lives covered.
SENATE COMMITTEE ON FINANCIAL INSTITUTIONS, ECONOMIC
DEVELOPMENT & TRADE
Staff: Clint McCarthy (786-7319)
Background: Insurers, insurance producers, and title insurance agents are limited in the
noncontractual benefits they may offer insureds or prospective insureds. Except to the extent
provided for in a filing with the Office of the Insurance Commissioner (OIC), no insurer,
insurance producer, or title insurance agent may, directly or indirectly, offer or pay to any
insured, potential insured, or an employee of an insured, any rebate, discount, or reduction of
premium, or any other valuable consideration or inducement whatsoever, not expressly
provided for in the insurance policy. Insurers, insurance producers, and title insurance agents
are prohibited from providing or offering, as inducements to insureds or prospective insureds,
any shares of stock or other securities or any kind of contract or agreement providing for or
promising profits or special returns or dividends.
There are various exceptions to the above prohibitions, including the following:
advertising or promotional programs conducted by insurers or insurance producers—
but not title insurers or title insurance agents—in which prizes, goods, gift cards, or
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This analysis was prepared by non-partisan legislative staff for the use of legislative
members in their deliberations. This analysis is not a part of the legislation nor does it
constitute a statement of legislative intent.
Senate Bill Report -1- SB 6144
merchandise, not exceeding $100 in value per person in the aggregate in any 12-
month period, are given to all insureds or prospective insureds under similar
qualifying circumstances;
certain health wellness programs conducted by a health carrier or disability insurer;
commissions paid to an insurance producer or title insurance agent for insurance
placed on their own property or risk;
the allowance by a marine insurer, or marine insurance producer, to any insured, in
connection with marine insurance, of such discount as is sanctioned by custom among
marine insurers as being additional to the insurance producer's commission; and
certain sales or purchases of securities.
During the 2019 session, prohibition against inducements or rebates to purchase insurance
statutes were amended to allow an insurer issue payment to offset documented expenses
incurred by a group policy holder in changing coverage from one insurer to another. Insurers
are required to describe such payments in the group insurance policy. Medicare
supplemental insurance is not allowed to offer payments to offset expenses. The payment by
the insurer must be included in the calculation of the premium tax.
Summary of Bill: Insurers are directed to describe implementation credits provided to a
policy holder and file the policy with the commissioner. Implementation credits are limited
as follows based on the number of lives covered:
for 1000 or more lives covered—$1 million;
for 51-1000 lives covered—$500,000; or
for less than 50 lives covered—$50,000.
The premium rate filing must include a certification that the implementation credit is
considered in the premium development, and the benefits provided are reasonable in relation
to the premium charged for the contract by a member of the American Academy of Actuaries
or other person approved by the insurance commissioner. An insurer offering
implementation credits must offer them to all similarly situated policyholders, with regard to
risk, exposure factors, and expense elements.
The insurance commissioner is provided rulemaking authority for oversight of
implementation credits.
Appropriation: None.
Fiscal Note: Requested on July 14, 2020.
Creates Committee/Commission/Task Force that includes Legislative members: No.
Effective Date: July 1, 2020
Senate Bill Report -2- SB 6144
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