A bill to provide restitution to policyholders harmed by their insurer or agent passed the Washington Senate on Wednesday on a 29 to 20 vote.
The bill, sponsored by Insurance Commissioner Patty Kuderer and sponsored by Senator Adrian Cortes (D–Battle Ground), would also provide fining parity for all insurance entities regulated by the Office of the Insurance Commissioner.
Related: Washington Commish Tells Insurers to Give Relief on Payments, Cancellations
The bill grants the commissioner the authority to require a company or person violating insurance laws to pay restitution.
Currently, when an insurance company uses rates that haven’t been approved by the commissioner, there is no mechanism to order repayment to policyholders who have overpaid. If an unauthorized insurer defrauds policyholders, the commissioner can fine the company but cannot order it to repay the money it took. If an insurance agent collects premiums but doesn’t forward that money to the insurance company, the Insurance commissioner can’t require them to repay the money they took.
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Also, the commissioner’s authority to fine certain property/casualty insurers is limited to $10,000, regardless of the number of violations. For health insurers, the limit is $10,000 per violation or offense. SB 5331 would align the two, allowing for per-violation fines of up to $10,000 for property/casualty insurance companies.
SB 5331 now heads to the House Consumer Protection & Business Committee for consideration.
Topics Washington Politics
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