CONFERENCE COMMITTEE REP. NO. 6

Honolulu, Hawaii

                 , 2011

RE:    S.B. No. 1278

       S.D. 1

       H.D. 2

       C.D. 1

Honorable Shan S. Tsutsui

President of the Senate

Twenty-Sixth State Legislature

Regular Session of 2011

State of Hawaii

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Sixth State Legislature

Regular Session of 2011

State of Hawaii

Sirs:

     Your Committee on Conference on the disagreeing vote of the Senate to the amendments proposed by the House of Representatives in S.B. No. 1278, S.D. 1, H.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO INSURANCE,"

having met, and after full and free discussion, has agreed to recommend and does recommend to the respective Houses the final passage of this bill in an amended form.

     The purpose of this measure is to protect insurance consumers, particularly seniors, from abusive practices by adopting model regulations from the National Association of Insurance Commissioners in compliance with the senior investment protection provisions of the federal Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.

     Your Committee on Conference finds that adoption of this measure will bring Hawaii's laws into conformity with the requirements of federal law, thereby enabling the Insurance Division of the Department of Commerce and Consumer Affairs to apply for federal grants to fund activities that protect seniors from misleading or fraudulent marketing in the sale of financial products.  Further, there is a real and present need beyond compliance with federal law for the protections included in this measure.  The Insurance Division reports the continuing receipt of complaints from consumers, particularly seniors, about abusive or misleading practices in the sale and marketing of annuities.  This measure is also fiscally responsible as it allocates the bulk of the training and compliance responsibilities to insurers, thereby strengthening the Insurance Division's regulatory and oversight functions without requiring new expenditures of state resources.

     Your Committee on Conference has amended this measure by inserting an effective date of July 1, 2011; provided that the training and procedural requirements imposed on insurers by sections 2 through 6 shall become effective on January 1, 2012.

     Your Committee on Conference finds that this measure, as amended, will allow insurers in the State adequate time to institute training programs and procedures to ensure full compliance with the requirements of this measure.

     As affirmed by the record of votes of the managers of your Committee on Conference that is attached to this report, your Committee on Conference is in accord with the intent and purpose of S.B. No. 1278, S.D. 1, H.D. 2, as amended herein, and recommends that it pass Final Reading in the form attached hereto as S.B. No. 1278, S.D. 1, H.D. 2, C.D. 1.

Respectfully submitted on behalf of the managers:

ON THE PART OF THE HOUSE

ON THE PART OF THE SENATE

____________________________ ROBERT N. HERKES, Co-Chair	____________________________ ROSALYN H. BAKER, Chair
____________________________ GILBERT KEITH-AGARAN, Co-Chair
____________________________ KYLE T. YAMASHITA, Co-Chair