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Senate Bill Report — SB 5409, As of February 8, 2021

Summary

Senate Bill Report on SB 5409, as of February 8, 2021, prepared for the Senate Committee on Business, Financial Services & Trade, with sponsors listed as Senators Dozier and Braun. The bill is titled as an act relating to requiring insurers who use credit information to provide reasonable exceptions to insurance rates for consumers experiencing extraordinary life circumstances. The brief summary says insurers must provide the exceptions if contacted in writing. Listed events include a catastrophic event declared by the federal or state government, identity theft and military deployment overseas, and the report states that the insurer must inform the consumer of the outcome within 30 days of receipt of sufficient documentation.

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
2021-02-09
Case
2021 02 09 A28531 D227730 Bill Report 5409 Sba Bfst 21

Cite this document

“Senate Bill Report — SB 5409, As of February 8, 2021.” Original at app.leg.wa.gov, dated 2021-02-09. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2021-02-09-2021-02-09-a28531-d227730-bill-report-5409-sba-bfst-21/, SHA-256 ed53aea1f4b1193f09ff8f072352e1314b0dbd5b123dc0c87881ff521c460e1a.

Full text

                            SENATE BILL REPORT
                                  SB 5409

                                      As of February 8, 2021

Title: An act relating to requiring insurers who use credit information to provide reasonable
     exceptions to insurance rates for consumers experiencing extraordinary life circumstances.

Brief Description: Requiring insurers who use credit information to provide reasonable
     exceptions to insurance rates for consumers experiencing extraordinary life circumstances.

Sponsors: Senators Dozier and Braun.

Brief History:
     Committee Activity: Business, Financial Services & Trade: 2/09/21.


                                     Brief Summary of Bill
           • Requires insurers to provide reasonable exceptions to insurance rates for
             consumers experiencing extraordinary life circumstances if contacted in
             writing.


SENATE COMMITTEE ON BUSINESS, FINANCIAL SERVICES & TRADE

     Staff: Kellee Gunn (786-7429)

     Background: Extraordinary Life Circumstances and Insurance. The National Council of
     Insurance Legislators (NCOIL) developed the Model Act Regarding Use of Credit
     Information in Personal Insurance (Model Act) in 2002. It has been readopted multiple
     times, most recently in November 2015. The Model Act allows insurance rates, where
     credit information is used, to be reconsidered in the event of an extraordinary life
     circumstance (ELC). More than 20 states have adopted some form of the Model Act,
     including ELC language.

     Summary of Bill: An insurer who uses credit information must provide reasonable
     exceptions to their rates, rating classification, company or tier placement, or underwriting



     This analysis was prepared by non-partisan legislative staff for the use of legislative
     members in their deliberations. This analysis is not part of the legislation nor does it
     constitute a statement of legislative intent.

Senate Bill Report                              -1-                                             SB 5409
     rules or guidelines for consumers whose credit has been affected by certain events. The
     insured or insurance applicant must request the reasonable exception in writing.

     ELCs or events include:
       • a catastrophic event, as declared by the federal or state government;
       • serious illness or injury of themselves or an immediate family member;
       • death of a spouse, child, or parent;
       • divorce or involuntary interruption or legally owed alimony or support payments;
       • identity theft;
       • temporary loss of employment for three months or more, if involuntary terminated;
       • military deployment overseas; or
       • other events determined by the insurer.

     Information and notice to consumers about the availability of these exceptions must be
     provided by the insurer.

     No more than 60 days from the date of the insurance application or policy renewal, the
     insurer may request:
         • written and independently verifiable documentation of the event;
         • demonstration that the event had a direct and meaningful impact on the consumer's
           credit information;
         • grant an exception without a written consumer request; and
         • grant an exception for a repeated or previously considered event.

     Within 30 days of receipt of sufficient documentation of an event, the insurer must inform
     the consumer of the outcome.

     Appropriation: None.

     Fiscal Note: Requested on February 2, 2021.

     Creates Committee/Commission/Task Force that includes Legislative members: No.

     Effective Date: Ninety days after adjournment of session in which bill is passed.




Senate Bill Report                            -2-                                        SB 5409

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2021-02-09_a28531_d227730_bill-report-5409-sba-bfst-21.pdf
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Our copy
2021-02-09_a28531_d227730_bill-report-5409-sba-bfst-21.pdf
Original
app.leg.wa.gov
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