Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Judiciary, to which was referred H.B. No. 2786 entitled:

begs leave to report as follows:

The purpose of this bill is to award attorney's fees and costs of arbitration to the prevailing policyholder, beneficiary under the policy, or the person who has acquired the rights thereof (policyholder) in an arbitrated insurance dispute over liability when an arbitrator or arbitration panel (arbitrator) orders an insurer to pay benefits to the policyholder.

The Department of Commerce and Consumer Affairs and the Consumer Lawyers of Hawaii supported this bill. The Hawaii Insurers Council opposed this measure. State Farm Insurance Companies opposed this bill and suggested amendments.

Your Committee finds that while this measure has merit, there remains unresolved issues regarding its applicability to disputes over coverage, as opposed to questions of liability.

To generate further discussion and more clarification, your Committee has amended this measure by:

(3) Changing the effective date to July 1, 2345; and

As affirmed by the record of votes of the members of your Committee on Judiciary that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2786, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2786, H.D. 1, and be placed on the calendar for Third Reading.