Honolulu, Hawaii
                                                     , 1999

                                   RE:  H.B. No. 1071
                                        H.D. 1
                                        S.D. 1

Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 1999
State of Hawaii


     Your Committee on Commerce and Consumer Protection, to which
was referred H.B. No. 1071, H.D. 1, entitled: 


begs leave to report as follows:

     The purpose of this bill is to allow the Insurance
Commissioner to hire attorneys not subject to Chapters 76 and 77,
Hawaii Revised Statutes.

     Your Committee finds that the insurance industry is an
evolving industry.  New innovative products are being offered and
regulation is changing to meet the demands of both the consumers
and the industry.  Passing an examination for licensing does not
ensure that the licensee has kept abreast of industry changes.
Your Committee believes that only through continuing education
will an individual have sufficient knowledge to properly advise,
solicit, or sell insurance products.  Your Committee would like
the insurance commissioner to work with agents and receive input
from them in designing of the continuing education program.

     Your Committee further finds that the Insurance Commissioner
plays a very important role in this State.  The Commissioner has
the responsibility of protecting consumers while at the same time
providing reasonable competition in the insurance market.  This
measure allows the commissioner to retain staff with expertise by
establishing a source of funding that has a direct relation to
the division's regulatory role.

                                   STAND. COM. REP. NO. 1154
                                   Page 2

     Your Committee further finds that this measure and its
source of funding is essential for the Department of Commerce and
Consumer Affairs' and the Insurance Division's move towards self-

     Your Committee has amended this measure by deleting all
substantive provisions and inserting language contained in H.B.
No. 1067, H.D. 2.

     As amended this bill would:

     (1)  Establish a continuing education program for licensees;

     (2)  Establish the insurance licensing administration
          special fund and allow moneys to remain in the special
          fund instead of reverting to the general fund;

     (3)  Appropriate moneys from the special fund to carry out
          the purposes of this measure; and 

     Your Committee has also made technical amendments for
purposes of style and clarity.

     As affirmed by the record of votes of the members of your
Committee on Commerce and Consumer Protection that is attached to
this report, your Committee is in accord with the intent and
purpose of H.B. No. 1071, H.D. 1, as amended herein, and
recommends that it pass Second Reading in the form attached
hereto as H.B. No. 1071, H.D. 1, S.D. 1, and be referred to the
Committee on Ways and Means.

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

                                   BRIAN KANNO, Co-Chair

                                   BRIAN T. TANIGUCHI, Co-Chair