Legislature(2009 - 2010)BELTZ 211

04/16/2009 03:45 PM LABOR & COMMERCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Time Change --
Moved CSSB 60(L&C) Out of Committee
Moved SCS CSHB 108(L&C) Out of Committee
Moved SCS CSHB 177(L&C) Out of Committee
Moved CSHB 175(L&C) Out of Committee
Moved HB 222(TITLE AM) Out of Committee
Bills Previously Heard/Scheduled
                    CSHB 175(L&C)-INSURANCE                                                                                 
5:50:16 PM                                                                                                                    
CHAIR PASKVAN announced HB 175  to be up for consideration. [CSHB
175(L&C) was before the committee.]                                                                                             
CONRAD  JACKSON, staff  to Representative  Olson,  sponsor of  HB
175, introduced Ms. Hall for the explanation.                                                                                   
5:51:34 PM                                                                                                                    
LINDA  HALL,  Director,  Division  of  Insurance,  Department  of                                                               
Commerce,  Community &  Economic  Development  (DCCED), said  she                                                               
considers a number of things in  the bill "clean up;" several are                                                               
streamlining  processes about  issuing licenses  to out  of state                                                               
adjusters,  providing third-party  administrators be  responsible                                                               
for  their  employees,  and accepting  another  regulator's  non-                                                               
resident  felony evaluations.  Other things  clarify deposits  of                                                               
domestic  and other  states'  insurers and  allow  a little  more                                                               
flexibility for  the regulatory  with domestic  insured deposits.                                                               
"Working day" is defined uniformly now throughout the title.                                                                    
Three  sections  are  uniformity   provisions  that  allow  ratio                                                               
analysis  in  examinations submitted  to  the  director from  the                                                               
National   Regulatory  Association   to  be   held  confidential;                                                               
currently just the financial material  is held. They have updated                                                               
products that can be sold for a limited lines travel license.                                                                   
MS.  HALL  remarked  that she  just  received  notification  that                                                               
Alaska is in  compliance with all of the  National Association of                                                               
Insurance Commissioners (NAIC) uniformity standards.                                                                            
Two new  issues are policy calls  in sections 11 and  17. Section                                                               
11 of this bill permits a  director to order a summary suspension                                                               
of a producer  license if there is a finding  that the protection                                                               
of the public  requires emergency action. This past  year she had                                                               
two instances  of the worst agent  behavior she had ever  seen in                                                               
Alaska. A  licensee was taking  money from his clients  and using                                                               
it  and  not purchasing  insurance.  Her  investigation found  72                                                               
victims  who were  left with  virtually  no financial  protection                                                               
should they  have a loss.  They have filed criminal  charges that                                                               
have 32  felony counts. This is  behavior that if they  could not                                                               
do  a  summary suspension  this  individual  could have  gone  on                                                               
taking  money as  long as  he had  asked for  a hearing  and that                                                               
order  was stayed.  The bill  has enough  protections to  prevent                                                               
summary suspensions from  being abused. The reasons  for doing it                                                               
are  subject  to  the  same  reasons in  statute  for  denial  or                                                               
revocation of  a license today;  so it doesn't  broaden anything,                                                               
but it stops behavior that harms the public.                                                                                    
5:55:39 PM                                                                                                                    
Section 17  allows a health  insurance plan to reward  a wellness                                                               
program  without making  it  considered as  a  rebate program  or                                                               
discrimination.  Its  requirements  would meet  Health  Insurance                                                               
Portability and  Accountability Act  (HIPAA) standards  and other                                                               
non discriminatory requirements.                                                                                                
The bill  defines eligibility for  a high  risk pool in  the same                                                               
way  as the  Permanent  Fund Dividend  does  today, a  uniformity                                                               
issue. Also,  the hospital and medical  service corporations make                                                               
guaranteed  renewability of  individual  health plans  mandatory;                                                               
today  it is  done for  group  plans; they  also make  guaranteed                                                               
renewability applicable to individual health plans.                                                                             
5:56:55 PM                                                                                                                    
CHAIR PASKVAN  said the summary suspension  for egregious conduct                                                               
makes a  lot of sense,  as do the  rewards for wellness.  He then                                                               
closed public testimony.                                                                                                        
5:57:38 PM                                                                                                                    
SENATOR MEYER moved  to report CSHB 175(L&C)  from committee with                                                               
individual  recommendations and  attached  fiscal note(s).  There                                                               
were no objections and it was so ordered.                                                                                       

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