Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committees on Commerce, Consumer Protection and Housing and Transportation, Military Affairs, and Government Operations, to which was referred H.B. No. 1819 entitled:

beg leave to report as follows:

The purpose of this measure is to exempt from the requirement that an insurer maintain a sales and claims office in the State, a member-owned reciprocal insurer and its wholly owned insurer subsidiaries that primarily insure military members and their dependents.

The Department of Commerce and Consumer Affairs and USAA testified in support of this measure.

This measure establishes an exception to the requirement that an insurer maintain a complete sales and claims service office in the State for a member-owned reciprocal insurer and its wholly owned insurer subsidiaries, where:

Instead, insurers are required to make satisfactory arrangements for claims service and adjustment and, upon request by the Insurance Commissioner, make available specific information on such arrangements.

Your Committees find that there is a high degree of mobility among the military membership of the affected insurers. This measure will provide these insurers with the flexibility to service their customers from the most appropriate claims location and provide more timely and efficient customer service, while continuing to ensure consumer protection.

As affirmed by the records of votes of the members of your Committees on Commerce, Consumer Protection and Housing and Transportation, Military Affairs, and Government Operations that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 1819, and recommend that it pass Second Reading and be placed on the calendar for Third Reading.