SHB 2087
In CommitteeHouse
Travel insurance
Addressing travel insurance.
This status may be delayed. See Action History below for the latest updates.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill establishes a new legal framework for selling travel insurance in Washington, including licensing for retailers and administrators, clear consumer disclosures, and prohibitions on misleading marketing. It defines travel insurance, distinguishes it from travel assistance services and cancellation fee waivers, and sets rules for how it can be sold and regulated.
- Creates a new chapter (Chapter 48.43 RCW) establishing a comprehensive legal framework for selling travel insurance in Washington, including definitions and licensing requirements.
- Requires travel retailers (e.g., travel agencies, tour operators) to register with a licensed limited lines travel insurance producer and prohibits unlicensed staff from giving insurance advice or interpreting policy terms.
- Mandates clear disclosures to consumers before and after purchase—including coverage details, claim processes, cancellation rights, and whether the insurance is primary or secondary—and provides a 15-day (or 10-day for non-mail delivery) cooling-off period for full refunds.
- Classifies travel insurance as an inland marine line of insurance (with exceptions for health-related coverages), and sets rules for rate and form filings.
- Prohibits unfair marketing practices, such as selling policies that can never pay claims, marketing blanket travel insurance as 'free,' and using 'negative option' (opt-out) enrollment for travel insurance during trip purchases.
- Requires travel insurers to pay premium tax on policies sold to Washington residents and to separately report insurance versus non-insurance (e.g., travel assistance services) charges.
Who is affected
- Travel insurance companies (insurers) — Travel insurance companies (insurers) that sell or administer travel insurance in Washington must comply with new licensing, disclosure, and tax rules; they must also ensure travel retailers and administrators follow state requirements.
- Travel retailers — Travel retailers (e.g., tour operators, travel agencies, cruise lines) that sell trips and may offer travel insurance must register with a licensed producer, provide clear disclosures, and ensure unlicensed staff do not give insurance advice.
- Travel administrators — Travel administrators (e.g., third-party platforms or service providers that handle claims, premiums, or underwriting for travel insurance) must be licensed property/casualty producers unless exempt, and insurers are responsible for their conduct.
- Washington residents (consumers) — Washington residents purchasing travel insurance gain new protections, including clear disclosures, a cooling-off period to cancel for a full refund, and assurance that marketing is truthful and not misleading.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (5)
Prohibits 'negative option' (opt-out) enrollment for travel insurance during trip purchases—ending a widespread and deceptive practice where consumers unknowingly paid for coverage they didn’t want or need.
consumer protectionPeopleRef: Sec. 6(4)Makes it an unfair trade practice to sell travel insurance policies that could never pay claims—directly targeting predatory or fraudulent products that exploit vulnerable travelers, especially seniors and low-income consumers.
consumer protectionPeopleRef: Sec. 6(2) & Sec. 12(1)Mandates a 15-day (or 10-day) cooling-off period for full refunds—giving consumers time to review coverage, compare options, and cancel without penalty, especially helpful for non-technical buyers.
consumer protectionPeopleRef: Sec. 6(3)(c)Requires clear, standardized disclosures about coverage terms, claim processes, cancellation rights, and insurer contact info—reducing confusion and enabling informed consent, especially for non-native English speakers or less-educated consumers.
consumer protectionPeopleRef: Sec. 3(2)(a)(i)-(iv) & Sec. 3(3)Prohibits marketing blanket travel insurance as 'free'—curbing misleading advertising that may诱导 consumers into purchasing unnecessary or overpriced packages under false pretenses.
consumer protectionLean peopleRef: Sec. 6(5)
Potential Concerns (5)
Excludes stand-alone prescription drug coverage that supplements Medicare Part D from the definition of travel insurance, potentially leaving travelers without clear coverage clarity or consumer protections for this common add-on service.
HealthcarePeopleRef: Sec. 2(13)(a)(iv)Requires travel retailers to register with a licensed limited lines producer and mandates that the producer designate a compliance officer and undergo fingerprinting—costs that disproportionately burden small travel agencies and independent operators who lack legal or compliance staff.
Business & EmploymentPeopleRef: Sec. 3(2)(a)(iv)Prohibits unlicensed travel retailer staff from interpreting policy terms or evaluating existing coverage—even when consumers ask for help understanding complex insurance language—reducing consumer autonomy and increasing reliance on licensed personnel during urgent travel issues.
Rights & LibertiesLean peopleRef: Sec. 3(4)(c)The 15-day (or 10-day) cooling-off period applies only if the insured has not started a covered trip or filed a claim—meaning travelers who book last-minute or face unexpected disruptions (e.g., illness, flight cancellation) may lose the right to a full refund if they attempt to cancel outside the narrow window.
HousingLean peopleRef: Sec. 6(3)(c)Requires insurers to separately report insurance versus non-insurance charges (e.g., travel assistance services), increasing administrative complexity and cost for small travel retailers and insurers that bundle services—potentially leading to higher prices or reduced service offerings.
Business & EmploymentLean peopleRef: Sec. 4(2)(b)
Who Is Most Affected
Washington residents purchasing travel insurance gain strong consumer protections—especially against deceptive marketing, opt-out enrollment, and nonpayable policies. The cooling-off period and disclosure rules disproportionately benefit low-income, elderly, and less-educated travelers who are most vulnerable to predatory sales tactics.
Travel insurers face new compliance and reporting obligations but benefit from clearer regulatory boundaries and the ability to rely on registered retailers for distribution. Premium tax obligations are modest and offset by expanded market legitimacy and reduced fraud risk.
Small travel agencies, tour operators, and cruise lines must register with licensed producers and restrict unlicensed staff from giving insurance advice—increasing operational costs and legal risk for mom-and-pop shops. Larger chains with compliance departments adapt more easily.
Third-party platforms and service providers that handle claims or premiums must now be licensed property/casualty producers—potentially excluding unlicensed fintechs or SaaS vendors that currently operate in the space, consolidating the market toward larger players.