STAND. COM. REP. NO.  555

 

Honolulu, Hawaii

                , 2011

 

RE:   H.B. No. 1620

 

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Sixth State Legislature

Regular Session of 2011

State of Hawaii

 

Sir:

 

     Your Committee on Public Safety & Military Affairs, to which was referred H.B. No. 1620 entitled:

 

"A BILL FOR AN ACT RELATING TO INSURANCE,"

 

begs leave to report as follows:

 

     The purpose of this bill is to exempt from the laws relating to fraternal benefit societies, associations that:

 

     (1)  Were organized before 1880;

 

     (2)  Consist of members who are active, retired, or honorably discharged members of the United States armed forces or sea services; and

 

     (3)  Have a principal purpose to provide insurance and other benefits to their members and their dependants or beneficiaries.

 

     Testimony in support of this measure was submitted from Navy Mutual.  The Department of Commerce and Consumer Affairs supported the intent of the measure.

 

     Your Committee finds that the types of associations proposed to be exempted by this measure pre-date the enactment of existing fraternal benefit society laws in Hawaii and are organized for the benefit of military members and their families.  These associations do not operate as commercial insurance companies, but are not specifically exempted from the State's fraternal benefit code along with societies that insure members of other hazardous occupations.  Your Committee notes that, although the Hawaii Insurance Commissioner has historically treated these associations as exempt from the definition of fraternal benefit societies, your Committee finds that this measure would codify this exemption.  Your Committee further finds that this measure would clarify the status of these associations so that they may continue to provide benefits to military service members that would not be available otherwise from traditional commercial insurance companies.

 

     As affirmed by the record of votes of the members of your Committee on Public Safety & Military Affairs that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1620 and recommends that it pass Second Reading and be referred to the Committee on Consumer Protection & Commerce.

 

 

Respectfully submitted on behalf of the members of the Committee on Public Safety & Military Affairs,

 

 

 

 

____________________________

HENRY J.C. AQUINO, Chair