AN ACT Relating to
capital and surplus requirements of insurers; and amending RCW 48.05.340.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF
WASHINGTON:
Sec. 1. RCW 48.05.340 and 1993 c
462 s 50 are each amended to read as follows:
(1) Subject to RCW
48.05.350 and 48.05.360 to qualify for authority to transact any one kind of
insurance as defined in chapter 48.11 RCW or combination of kinds of insurance
as shown below, a foreign or alien insurer, whether stock or mutual, or a
domestic insurer hereafter formed shall possess ((and thereafter maintain))
unimpaired paid-in capital stock, if a stock insurer, or unimpaired surplus if
a mutual insurer, and ((shall possess when first so authorized))
additional funds in surplus, as follows, and shall thereafter
maintain unimpaired a combined total of: (a) The paid-in capital stock if a
stock insurer or surplus if a mutual insurer, plus (b) such additional funds in
surplus equal to the total of the following initial requirements:
Paid-in
capital
Kind or kinds
stock or Additional
of insurance basic
surplus surplus
Life ................................. $2,000,000 $2,000,000
Disability............................ 2,000,000 2,000,000
Life and disability .................. 2,400,000 2,400,000
Property.............................. 2,000,000 2,000,000
Marine & transportation ............. 2,000,000........................ 2,000,000
General casualty...................... 2,400,000 2,400,000
Vehicle............................... 2,000,000 2,000,000
Surety................................ 2,000,000 2,000,000
Any two of the
following
kinds of
insurance:
Property,
marine &
transportation,
general
casualty,
vehicle,
surety, disability................. 3,000,000 3,000,000
Multiple lines
(all insurances
except life
and title
insurance) ........................ 3,000,000 3,000,000
Title (in
accordance with the
provisions of chapter 48.29 RCW)
(2) Capital and surplus requirements are
based upon all the kinds of insurance transacted by the insurer wherever it may
operate or propose to operate, whether or not only a portion of such kinds are
to be transacted in this state.
(3) ((An)) Until December 31, 1996,
a foreign or alien insurer holding a certificate of authority to transact
insurance in this state immediately prior to ((July 1, 1991)) the
effective date of this act, may continue to be authorized to transact the
same kinds of insurance as long as it is otherwise qualified for such authority.
A domestic insurer holding a certificate of authority to transact insurance in
this state immediately prior to the effective date of this act may continue to
be authorized to transact the same kinds of insurance as long as it is
otherwise qualified for such an authority and thereafter maintains
unimpaired the amount of paid-in capital stock, if a stock insurer, or basic
surplus, if a mutual or reciprocal insurer, and special or additional
surplus as required of it under laws in force immediately prior to ((such
effective date; and any proposed domestic insurer which is in process of
formation or financing under a solicitation permit which is outstanding
immediately prior to July 1, 1991, shall, if otherwise qualified therefor, be
authorized to transact any kind or kinds of insurance upon the basis of the
capital and surplus requirements of such an insurer under the laws in force
immediately prior to such effective date. The requirements for paid-in capital
stock, basic surplus, and special surplus that were in effect immediately
before July 1, 1991, apply to any completed application for a certificate of
authority from a foreign or alien insurer that is on file with the commissioner
on July 1, 1991)) the effective date of this act.
(4) The
commissioner may, by rule, require insurers to maintain additional capital and
surplus based upon the type, volume, and nature of insurance business
transacted consistent with the methods then adopted by the National Association
of Insurance Commissioners for determining the appropriate amount of additional
capital and surplus to be required. In the absence of an applicable rule, the
commissioner may, after a hearing or with the consent of the insurer, require
an insurer to have and maintain a larger amount of capital or surplus than
prescribed under this section or the rules under this section, based upon the
volume and kinds of insurance transacted by the insurer and on the principles
of risk-based capital as determined by the National Association of Insurance
Commissioners. This subsection applies only to insurers authorized to write
life insurance, disability insurance, or both.
