Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committees on Consumer Protection and Commerce and Judiciary and Hawaiian Affairs, to which was referred H.B. No. 592 entitled:

beg leave to report as follows:

The purpose of this bill is to adopt the National Association of Insurance Commissioners' Producer Licensing Model Act, and to include additional language providing for insurance producer continuing education.

The Department of Commerce and Consumer Affairs, American Counsel of Life Insurers, State Farm Insurance Companies, and Association of Insurance and Financial Advisors supported this bill. Hawaii Independent Insurance Agents Association supported this bill with reservations. The Office of Information Practices and National Association of Independent Insurers commented on this bill.

Your Committees find that under the Gramm-Leach-Bliley Act (GLBA), a majority of states must have either uniform or reciprocal producer licensing laws in place by November 12, 2002. Failure to accomplish this would trigger the creation and implementation of the National Association of Registered Agents and Brokers (NARAB) licensing authority, which would remove direct agent and broker licensing oversight from the states and place it under the federally created NARAB, until NARAB is dissolved by Congress.

Your Committees find that the continuing education reciprocity provisions of this measure may render it defective for purposes of complying with GLBA. Your Committees have amended this bill by changing its effective date to January 1, 2040, to allow further discussion and resolution of this, and other issues.

As affirmed by the records of votes of the members of your Committees on Consumer Protection and Commerce and Judiciary and Hawaiian Affairs that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 592, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 592, H.D. 1, and be placed on the calendar for Third Reading.