STAND. COM. REP. NO.  360

 

Honolulu, Hawaii

                , 2007

 

RE:   H.B. No. 90

      H.D. 1

 

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Fourth State Legislature

Regular Session of 2007

State of Hawaii

 

Sir:

 

     Your Committee on Consumer Protection & Commerce, to which was referred H.B. No. 90 entitled:

 

"A BILL FOR AN ACT RELATING TO INSURANCE,"

 

begs leave to report as follows:

 

     The purpose of this bill is to enhance the monitoring of the insurance marketplace by adopting the National Conference of Insurance Legislators Market Conduct Surveillance Model Law, which establishes a framework for the Insurance Commissioner to conduct market conduct examinations of domestic and foreign insurers.

 

     The American Council of Life Insurers testified in support of this bill.  The Department of Commerce and Consumer Affairs supported the intent of this measure.  State Farm Insurance Companies and a concerned individual submitted comments.

 

     A market conduct examination is a review of an insurer's marketplace practices.  Your Committee finds that this bill implements procedures for the Insurance Commissioner to conduct comprehensive and targeted market conduct examinations of an insurer's operations to evaluate compliance with applicable state laws.


 

     Your Committee has amended this measure by:

 

     (1)  Requiring the Insurance Commissioner to use market analysis and market conduct examination procedures that are substantially similar to the National Association of Insurance Commissioners' (NAIC) guidelines, rather than procedures that are substantially similar to those in specific NAIC handbooks;

 

     (2)  Applying the Market Conduct Surveillance Law to mutual benefit societies; and

 

     (3)  Making technical, nonsubstantive amendments for clarity and style.

 

     As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 90, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 90, H.D. 1, and be referred to the Committee on Finance.

 

Respectfully submitted on behalf of the members of the Committee on Consumer Protection & Commerce,

 

 

 

 

____________________________

ROBERT N. HERKES, Chair