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