Life insurance/suicide limit

AN ACT Relating to limitation of liability in life insurance 1
policies; amending RCW 48.23.260 and 48.34.090; creating a new 2
section; and providing an effective date. 3
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:4
Sec. 1. RCW 48.23.260 and 1947 c 79 s . 23.26 are each amended to 5
read as follows: 6
(1) The insurer may in any life insurance policy or annuity or 7
pure endowment contract limit its liability to a determinable amount 8
not less than the full reserve of the policy and of dividend 9
additions thereto in event only of death occurring:10
(a) As a result of war, or any act of war, declared or 11
undeclared, or of service in the military, naval or air forces or in 12
civilian forces auxiliary thereto, or from any cause while a member 13
of any such military, naval or air forces of any country at war, 14
declared or undeclared. 15
(b) As a result of suicide of the insured, whether sane or 16
insane, within ((two years )) one year from date of issue of the 17
policy. 18
(c) As a result of aviation under conditions specified in the 19
policy. 20
S-0450.2
SENATE BILL 5495
State of Washington 69th Legislature 2025 Regular Session
By Senators Saldaña, Warnick, Nobles, and Valdez
Read first time 01/27/25. Referred to Committee on Business,
Financial Services & Trade.
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(2) An insurer may specify conditions pertaining to the items of 1
subsection (1) of this section which in the commissioner's opinion 2
are more favorable to the policyholder. 3
Sec. 2. RCW 48.34.090 and 1975 1st ex.s. c 266 s 13 are each 4
amended to read as follows: 5
(1) All credit life insurance and credit accident and health 6
insurance shall be evidenced by an individual policy, or in the case 7
of group insurance by a certificate of insurance, which individual 8
policy or group certificate of insurance shall be delivered to the 9
debtor. 10
(2) Each individual policy or group certificate of credit life 11
insurance, and/or credit accident and health insurance shall, in 12
addition to other requirements of law, set forth the name and home 13
office address of the insurer, the name or names of the debtor or in 14
the case of a certificate under a group policy, the identity by name 15
or otherwise of the debtor, the premium or amount of payment, if any, 16
by the debtor separately for credit life insurance and credit 17
accident and health insurance, a description of the coverage 18
including the amount and term thereof, and any exceptions, 19
limitations and restrictions, and shall state that the benefits shall 20
be paid to the creditor to reduce or extinguish the unpaid 21
indebtedness and, wherever the amount of insurance exceeds the unpaid 22
indebtedness, that any such excess shall be payable to a beneficiary, 23
other than the creditor, named by the debtor or to the debtor's 24
estate. With respect to any policy issued after ((September 8, 1975)) 25
January 1, 2026 , credit life insurance shall not be subject to any 26
exceptions or reductions other than for fraud, or for suicide 27
occurring within ((two years)) one year of the effective date of the 28
insurance. 29
(3) The individual policy or group certificate of insurance shall 30
be delivered to the insured debtor at the time the indebtedness is 31
incurred except as provided in subsections (4) and (5).32
(4) If such individual policy or group certificate of insurance 33
is not delivered to the debtor at the time the indebtedness is 34
incurred, a copy of the application for such policy or a notice of 35
proposed insurance, signed by the debtor and setting forth the name 36
and home office address of the insurer; the name or names of the 37
debtor; the premium or amount of payment by the debtor, if any, 38
separately for credit life insurance and credit accident and health 39
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insurance; the amount, term and a brief description of the coverage 1
provided, shall be delivered to the debtor at the time such 2
indebtedness is incurred. The copy of the application for, or notice 3
of proposed insurance, shall also refer exclusively to insurance 4
coverage, and shall be separate and apart from the loan, sale or 5
other credit statement of account, instrument, or agreement, or the 6
application for any such loan, sale or credit, unless the information 7
required by this subsection is prominently set forth therein under a 8
descriptive heading which shall be underlined and printed in capital 9
letters. Upon acceptance of the insurance by the insurer and within 10
thirty days of the date upon which the indebtedness is incurred, the 11
insurer shall cause the individual policy or group certificate of 12
insurance to be delivered to the debtor. The application or notice of 13
proposed insurance shall state that upon acceptance by the insurer, 14
the insurance shall become effective as provided in RCW 48.34.080.15
(5) If the named insurer does not accept the risk, then the 16
debtor shall receive a policy or certificate of insurance setting 17
forth the name and home office address of the substituted insurer and 18
the amount of the premium to be charged, and if the amount of premium 19
is less than that set forth in the notice of proposed insurance an 20
appropriate refund shall be made. 21
NEW SECTION. Sec. 3. This act takes effect January 1, 2026.22
NEW SECTION. Sec. 4. This act applies to life insurance 23
policies issued or renewed on or after the effective date of this 24
section.25
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