Report Title:

Motor Vehicle Insurers; Claims Office

Description:

Replaces the requirement that motor vehicle insurers maintain a complete sales and claims service office in the State with the requirement that insurers provide for claims service and adjustment and service of policies sold or issued to Hawaii consumers.

THE SENATE

S.B. NO.

307

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to insurers.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Hawaii currently requires that a motor vehicle insurer doing business in Hawaii maintain a complete sales and claims service office in the State. In recent years, however, the insurance industry has moved towards the increased usage of telephones or the Internet to provide better service to its customers. This is a trend that will continue into the future.

Consumers do not necessarily require the presence of an office within the State in order to ensure that they receive claims service and adjustment or policy service; such arrangements may be made by other means.

Eliminating the requirement of a physical office will place Hawaii in a position similar to that of other states that have no such requirement, making it less difficult and less expensive for insurers to maintain business in Hawaii. Hawaii consumers will benefit from having insurance products more readily available to them.

SECTION 2. Section 431:10C-119, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Prior to licensing an insurer to transact a motor vehicle insurance business in this State, the commissioner:

(1) Shall effect a thorough examination of the insurer's business experience, financial soundness, and general reputation as an insurer in this and other states. In the discretion of the commissioner, this examination may include an examination of any or all of the business records of the insurer, and an audit of all or any part of the insurer's motor vehicle insurance business, each to be performed by the commissioner's staff or by independent consultants. No license shall be issued until the commissioner is satisfied as to the business experience, financial solvency, and the economic soundness of the insurer;

(2) Shall require of each insurer, and determine that satisfactory arrangements have been made for[, the provision of a complete sales and claims service office in the] claims service and adjustment and for service of policies sold or issued to consumers in this State; and

(3) Notwithstanding any other requirements of this section or of the insurance code, may require a bond in a reasonable amount and with deposits or sureties determined in the commissioner's discretion of any applicant for a license hereunder. The commissioner may, at any time, make and enforce such a requirement of any licensed insurer or self-insurer."

SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 4. This Act shall take effect upon its approval.

INTRODUCED BY:

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