STAND. COM. REP. NO. 2260

                                   Honolulu, Hawaii
                                                     , 2000

                                   RE:  S.B. No. 2813
                                        S.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Commerce and Consumer Protection, to which
was referred S.B. No. 2813 entitled: 

     "A BILL FOR AN ACT RELATING TO INSURANCE,"

begs leave to report as follows:

     The purpose of this measure is to clarify various provisions
of the insurance code, establish a general notice requirement for
policy cancellations and nonrenewals, and increase certain
financial requirements and penalties for insurance licensees.

     Testimony on the measure was received from the Insurance
Division of the Department of Commerce and Consumer Affairs,
Hawaii Insurers Council, American Council of Life Insurers, and
the Hawaii State Association of Insurance and Financial Advisors. 

     This measure makes clarifications throughout the insurance
code with respect to terminology, the requirement of an
appointment from an insurer to solicit or place policies, record
sharing and retention, the Insurance Commissioner's authority to
contract for professional services, payment of tax refunds out of
the general fund, requirements for persons adjusting losses in
the State during a catastrophe, premium rates, and the laws
applicable to fraternal benefit societies.  Additionally, the
measure establishes a thirty-day notice requirement for policy
cancellations and nonrenewals, increases minimum irrevocable
trust fund requirements for alien insurers, increases penalties
and fines, and requires escheated funds to be deposited into the
general fund, rather than the insurance regulation fund. 

 
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                                   STAND. COM. REP. NO. 2260
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     Your Committee has amended this measure by:

     (1)  Reducing the notice requirement for policy
          cancellations from thirty days to ten days; and 

     (2)  Making technical, nonsubstantive amendments to correct
          spelling and statutory references, and to reflect
          preferred drafting style. 
     
     As affirmed by the record of votes of the members of your
Committee on Commerce and Consumer Protection that is attached to
this report, your Committee is in accord with the intent and
purpose of S.B. No. 2813, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as S.B.
No. 2813, S.D. 1, and be referred to the Committee on Ways and
Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Commerce and
                                   Consumer Protection,



                                   ______________________________
                                   BRIAN KANNO, Co-Chair



                                   ______________________________
                                   BRIAN T. TANIGUCHI, Co-Chair

 
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