04/03/1996 03:28 PM House L&C

 SB 197 - INS:DOMESTIC VIOL. VICTIMS & DISCLOSURES                           
                                                                               
 Number 128                                                                    
                                                                               
 CHAIRMAN PETE KOTT announced the first order of business would be             
 CSSB 197(L&C), "An Act relating to insurance covering an insured              
 who is a victim of domestic violence and requiring certain                    
 disclosures by an insurer."  He said the bill had been heard at               
 least on three occasions.  There is currently a committee                     
 substitute that is before the committee.  Chairman Kott explained             
 there was a proposed amendment before the committee.                          
                                                                               
 REPRESENTATIVE NORMAN ROKEBERG made a motion to rescind the                   
 amendment he had offered.                                                     
                                                                               
 CHAIRMAN KOTT explained the amendment wasn't adopted and that                 
 Representative Rokeberg should move to withdraw the amendment as it           
 wasn't adopted.                                                               
                                                                               
 REPRESENTATIVE ROKEBERG moved to withdraw the amendment.  Hearing             
 no objection, it was so ordered.                                              
                                                                               
 Number 205                                                                    
                                                                               
 REPRESENTATIVE ROKEBERG moved to adopt the new committee                      
 substitute, Version R, dated 4/3/96, Ford.                                    
                                                                               
 CHAIRMAN KOTT asked if there was an objection to the adoption of              
 the new committee substitute.  Hearing none, HCSCSSB 197(L&C) was             
 before the committee.                                                         
                                                                               
 Number 250                                                                    
                                                                               
 REPRESENTATIVE ROKEBERG said, "In section - excuse me - subsections           
 (1) and (2) this was a area that we discussed in committee.  I                
 think there was general concurrence, including with the sponsor and           
 industry that this would be acceptable because it required notice             
 to an applicant for insurance if they were turned down - the reason           
 they were being turned down, only upon written request.  The                  
 purpose of that particular revision was to provide -- to ease the             
 burden on industry and to make sure that any consumer that was                
 refused any insurance, and for the record, this include all                   
 insurance, not just those related to domestic violence Mr.                    
 Chairman, would be duly notified of the reason for the refusal to             
 write a policy of insurance.  Then in addition, this Version R                
 deletes the provisions on confidentiality that were in the last               
 version of the bill, as provided by the sponsor of the bill,                  
 related to records and so forth.  We've heard testimony that this             
 would be a burden on industry and that the -- it really wasn't                
 necessary because of existing procedures.  I would draw the                   
 committee's attention to a letter from the law firm of Lessmeier              
 and Winters.  It was distributed today and dated April 3.  It                 
 outlines some burdens that would be placed on industry if that                
 clause were to be left in.  And a -- I'm sure the committee has had           
 an opportunity to read this.  And I've talked to the sponsor of the           
 bill and he's agreed to accept that particular revision.                      
 Basically, that is the gist of the changes.  Mr. Chairman, we                 
 should keep in mind the original concept of the bill, which was to            
 ensure that victims of domestic violence would not be refused                 
 insurance or denied coverage or have any premium adjustments and so           
 forth.  That language has been retained in the bill which is really           
 the heart of the legislation."                                                
                                                                               
 Number 436                                                                    
                                                                               
 CHAIRMAN KOTT informed the committee there is a proposed amendment            
 to the new committee substitute which will be labeled Amendment 1.            
 Chairman Kott moved the amendment be adopted.                                 
                                                                               
 REPRESENTATIVE KIM ELTON objected for the purpose of discussion.              
                                                                               
 CHAIRMAN KOTT explained Amendment 1 makes it clear that you can               
 adjust rates for a condition but not a cause.                                 
                                                                               
 Number 498                                                                    
                                                                               
 SENATOR DAVE DONLEY, sponsor of SB 197, said, "I'm concerned about            
 section (c) of this proposed amendment.  It says the above section,           
 which is basically the guts of the bill I would think - since I               
 didn't draft this I'm not exactly sure, but the nondiscrimination             
 provision would only apply to an insured or an applicant for                  
 insurance.  That would allow discrimination against third party               
 beneficiaries of policies and I just don't that language is                   
 necessary.  Section (b), I don't think it's necessary but it                  
 doesn't seem to be contrary to what the bill already says."                   
                                                                               
 REPRESENTATIVE ROKEBERG said he thinks the provision was to allow             
 insurance companies to do their rating underwriting without regard            
 to the cause.  They could do rating based on something like a                 
 preexisting condition or another condition, notwithstanding the               
 fact that there was domestic violence.                                        
                                                                               
 SENATOR DONLEY said he doesn't think section (b) conflicts with the           
 bill as it is currently written.  He said he doesn't think it is              
 necessary, but noted he doesn't think it is in conflict with what             
 the bill says.  Senator Donley explained section (c) concerns him             
 because it narrows the scope of the bill to insure an applicant for           
 insurance and it would cut out any third party beneficiary or                 
 anybody else that may be a beneficiary of an insurance policy.  He            
 said he doesn't think those people should be discriminated against            
 either.  Senator Donley said, "I think (c) is not wise, I think (b)           
 doesn't conflict with the existing bill."  If that makes the                  
 insurance industry happy, he doesn't think it is necessary.  It               
 doesn't do violence to the bill.                                              
                                                                               
 Number 651                                                                    
                                                                               
 REPRESENTATIVE ROKEBERG said he didn't understand the point about             
 the third party beneficiary.  He asked how it relates to the first            
 section.                                                                      
                                                                               
 SENATOR DONLEY said, "I think in the world of insurance, that could           
 be read to mean that just if your name is on the insurance policy,            
 do you have the protection against discrimination?  If you're a               
 third party beneficiary of the benefits of a policy, rather than              
 being insured you would still be -- you could still legally                   
 discriminate and I don't think that is what the committee really              
 wants.  I mean I don't think that's good public policy.  That's the           
 only reason I can see for having that language in there is to allow           
 discrimination against other beneficiaries of the insurance and I             
 don't think that's appropriate based only the fact that if they're            
 a victim of domestic violence.                                                
                                                                               
 Number 743                                                                    
                                                                               
 CHAIRMAN KOTT asked if it would be satisfactory to delete                     
 subsection (c).  He then made a motion to amend the amendment to              
 delete subsection (c) and number the sections accordingly.                    
                                                                               
 CHAIRMAN KOTT asked if there was an objection to amend the                    
 amendment.  Hearing none, the amendment was before the committee.             
 Chairman Kott asked if there was an objection to the amendment.               
                                                                               
 Number 775                                                                    
                                                                               
 REPRESENTATIVE ROKEBERG objected.  He said he wanted know if the              
 sponsor had a problem with the amendment.                                     
                                                                               
 SENATOR DONLEY said he doesn't think it harms the purpose of the              
 bill.  He said he thinks it is consistent with what has been said             
 all along.  Unless the specific reason was that they were a victim            
 of domestic violence rather than some other appropriate                       
 underwriting criteria.  He stated he doesn't think it is necessary,           
 but it doesn't harm the ultimate purpose of the bill.                         
                                                                               
 CHAIRMAN KOTT asked if there was an objection to the amendment.               
 Hearing none, the amendment was adopted.                                      
                                                                               
 CHAIRMAN KOTT said the bill is an Act relating to insurance                   
 covering an insured.  He said through the committee process, we               
 have covered procedures within the bill dealing with an applicant             
 which is not an insured.  Chairman Kott said in his opinion, the              
 title of the bill needs to be changed to reflect the contents.                
                                                                               
 SENATOR DONLEY said in working with the drafters in developing the            
 committee substitute currently before the committee, the drafters             
 are usually pretty good in pointing something like that out.  He              
 said since the version that came over from the Senate also use the            
 word "applicants" at some point, he thinks it is O.K. because the             
 insured is also frequently an applicant.                                      
                                                                               
 Number 915                                                                    
                                                                               
 REPRESENTATIVE ROKEBERG said, "The whole provision about the reason           
 an applicant got turned down -- we're talking about applicants                
 here, it may not even be covered as an insured so..."                         
                                                                               
 CHAIRMAN KOTT said that is something that could be checked on with            
 the drafters.  If there is a problem, it can be adjusted.                     
                                                                               
 Number 956                                                                    
                                                                               
 REPRESENTATIVE ROKEBERG made a motion to move HCSCSSB 197, as                 
 amended, Version R, with the accompanying fiscal notes and                    
 individual recommendations.                                                   
                                                                               
 CHAIRMAN KOTT asked if there was an objection.  Hearing none,                 
 HCSCSSB 197(L&C), as amended, was moved out of the House Labor and            
 Commerce Committee