This bill amends RCW 48.23.030 and adds a new section to chapter 48.23 RCW to change procedures for individual life insurance nonpayment lapses and applicant notice. Insurers must send a written notice at least 30 days before coverage will lapse for nonpayment to the policyholder and to any third-party designee the applicant or policyholder has named. Insurers must obtain and, on request, show proof of delivery (examples listed include first-class mail with an intelligent mail barcode, certified mail receipt, electronic read-receipt, or shipping tracking confirmation). The bill defines a grace period of one month, but not less than 30 days, for payment after the first premium; the policy remains in force during that period and the insurer may charge interest up to 6% per annum for days of grace, with overdue premiums and interest potentially deducted from claim settlements if a claim occurs during the grace period. The new section requires insurers to notify applicants in writing at the time of application of the right to designate a third-party designee, and allows designation or changes at application or anytime the policy is in force by written notice containing the designee’s name and address. The designation does not create duties or liabilities for the designee (for example, to inform the policyholder, pay premiums, or act on the notice) and does not create insurer liability with respect to the designee for failure to send a notice. The bill exempts group life insurance, policies with premiums due monthly or more often, and term life policies with terms of one year or less from the new notice and third-party designation requirements. These changes are procedural consumer-protection measures rather than new crimes or penalties, and they apply prospectively only to individual life insurance policies issued on or after the effective date, January 1, 2027. The provided facts do not include how these changes interact with the rest of chapter 48.23 or other statutes, so understanding their full legal context would require reviewing the existing statutes outside the supplied text.

If enacted, the bill will make it more likely that people with new individual life policies in Washington won’t lose coverage unexpectedly: insurers must notify the policyholder and any person the applicant names at least 30 days before a policy will lapse for nonpayment, explain the right to name a third-party at application, and allow a one-month (minimum 30-day) grace period with interest up to 6% per year on overdue premiums; the policy remains in force during that grace period and unpaid amounts may be deducted from any claim paid during it. The requirement to obtain and show proof of delivery (for example certified mail, tracked shipping, or electronic read-receipts) increases the paperwork and recordkeeping insurers must do, but designees receive notice without taking on responsibility to act or pay. Insurers writing individual life business after January 1, 2027 will face new administrative responsibilities and modest additional costs to change application materials, send duplicate notices when a designee is named, and retain delivery proof; they also must apply the specified grace-period interest and claims handling rules. Policyholders and applicants gain a clearer protection against inadvertent lapses and the option to alert a trusted third party, while third-party designees get information but no legal duties. The text does not show how these new rules interact with the rest of chapter 48.23 or other operational details, so some implementation specifics remain unclear.