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Senate Bill Report — SB 5879, Reasonable Exceptions to Insurance Rates for Extraordinary Life Circumstances

Summary

A Senate Bill Report on SB 5879, as of January 18, 2022, an act requiring insurers who use credit information to provide reasonable exceptions to insurance rates for consumers experiencing extraordinary life circumstances. Senators Dozier, Sefzik and Warnick are listed as sponsors. The insured or insurance applicant must request the exception in writing, and the listed events include a catastrophic event declared by the federal or state government, identity theft, military deployment overseas and temporary loss of employment for three months or more. Within 30 days of receipt of sufficient documentation of an event, the insurer must inform the consumer of the outcome. The report states that the National Council of Insurance Legislators developed a Model Act on credit information in 2002.

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
2022-01-20
Case
2022 01 20 A29484 D238033 Bill Report 5879 Sba Bfst 22

Cite this document

“Senate Bill Report — SB 5879, Reasonable Exceptions to Insurance Rates for Extraordinary Life Circumstances.” Original at app.leg.wa.gov, dated 2022-01-20. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2022-01-20-2022-01-20-a29484-d238033-bill-report-5879-sba-bfst-22/, SHA-256 a552745b40e3d5c0d854a09d1005c23144c1a83c20b004b0019d87c65479f0a9.

Full text

                            SENATE BILL REPORT
                                  SB 5879

                                      As of January 18, 2022

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, Sefzik and Warnick.

Brief History:
     Committee Activity: Business, Financial Services & Trade: 1/20/22.


                                     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).

     Summary of Bill: An insurer who uses credit information must provide reasonable
     exceptions to their rates, rating classification, company or tier placement, or underwriting
     rules or guidelines for consumers whose credit has been affected by certain events. The



     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 5879
     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 of 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;
         • request 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 January 16, 2022.

     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 5879

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Our copy
2022-01-20_a29484_d238033_bill-report-5879-sba-bfst-22.pdf
Original
app.leg.wa.gov
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