STAND. COM. REP. NO. 1843

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: S.B. No. 1129
                                     S.D. 2
                                     H.D. 2




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Finance, to which was referred S.B. No.
1129, S.D. 2, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO INSURANCE,"

begs leave to report as follows:

     The purpose of this bill is to:

     (1)  Prescribe continuing education requirements for those
          working in the insurance industry and licensed by the
          State;

     (2)  Support this continuing education program through
          increased licensing and other fees that are to be paid
          into a newly established Insurance Licensing
          Administration (ILA) special fund, to be used to
          administer the continuing education program; 

     (3)  Raise all fees required by section 431:7-101, Hawaii
          Revised Statutes (HRS), by 50 percent;

     (4)  Establish an Insurance Regulation Fund (IRF) into which
          all assessments, fees, fines, and other moneys
          collected by the Department of Commerce and Consumer
          Affairs (DCCA) under Title 24, (Insurance), HRS, except
          for those paid into the Commissioner's Education and
          Training Fund, the Drivers Education Fund Underwriters
          Fee, and the Captive Insurance Administrative Fund,

 
 
                                 STAND. COM. REP. NO. 1843
                                 Page 2

 
          shall be paid.  Moneys in the IRF shall be used by DCCA
          to administer Title 24;

     (5)  Repeal the Insurance Examiners Revolving Fund and
          appointment of examiners, under section 431:2-307, HRS;
          and

     (6)  Provide HEMIC with an exemption from levy under section
          386-153, HRS.

     The Hawaii Employers' Mutual Insurance Company, Inc.
testified in support of this bill.  The Department of Commerce
and Consumer Affairs, the Hawaii State Association of Life
Underwriters, the Hawaii Independent Insurance Agents
Association, the Hawaii Insurers Council, and the State Farm
Insurance Companies, the Atlas Insurance Agency commented on this
bill.

     To address concerns regarding state regulations without
industry input, your Committee recommends to the Insurance
Commissioner that the following organizations be consulted on the
scope and nature of courses, providers, and credits under the
continuing education program proposed in this bill:  Hawaii
Chapter of Financial Service Professionals, Chartered Property
and Casualty Underwriters, Hawaii State Association of Life
Underwriters, Hawaii Independent Insurance Agents Association,
State Farm Insurance Companies, and the Hawaii Insurers Council.

     Additionally, your Committee wants to note its concern with
the 50 percent fee increase.

     Your Committee has amended this bill by making technical,
nonsubstantive changes for style, clarity, and consistency.

     As affirmed by the record of votes of the members of your
Committee on Finance that is attached to this report, your
Committee is in accord with the intent and purpose of S.B. No.
1129, S.D. 2, H.D. 1, as amended herein, and recommends that it
pass Third Reading in the form attached hereto as S.B. No. 1129,
S.D. 2, H.D. 2.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Finance,



                                   ______________________________
                                   DWIGHT Y. TAKAMINE, Chair