Date: 01/29/2015

Final
BILL SUMMARY for HB15-1048

HOUSE COMMITTEE ON HEALTH, INSURANCE, & ENVIRONMENT

Votes: View--> Action Taken:
Refer House Bill 15-1048 to the Committee on ApproPASS



02:06 PM -- HB 15-1048

The committee came back to order. Representative Williams presented House Bill 15-1048. The bill enacts National Association of Insurance Commissioners (NAIC) model legislation that requires the Commissioner of Insurance (commissioner) in the Division of Insurance in the Department of Regulatory Agencies to adopt the NAIC Standard Valuation Manual, which uses principle-based reserving (PBR) requirements to modernize the method by which life insurance reserve requirements are calculated. The bill requires the commissioner to promulgate rules regarding actuarial opinions of reserves, minimum standards applicable to the valuation of life insurance plans, and enforcement. The bill also allows the commissioner to employ qualified actuaries to review a life insurance company's PBR assumptions at the expense of the company. Life insurance companies doing business only in Colorado are exempt from the bill.

Under the bill, at least 42 NAIC members (states) or three-fourths of voting members, whichever is greater, representing greater than 75 percent of gross premiums must adopt similar legislation before the bill can go into effect. PBR becomes effective on January 1 of the first calendar year following the first July 1 when the thresholds described have been met. Pursuant to the NAIC Standard Valuation Manual, insurance companies domiciled in Colorado have an additional three years following this effective date to implement PBR for new policies issued after the effective date. Representative Williams responded to questions about the bill.

02:10 PM -- Ellen Poole, United Services Automobile Association, testified in support of the bill. She discussed how the bill would benefit her company's clients. Ms. Poole responded to questions about other states adopting the model legislation. In response to a questions, she discussed how the bill will impact consumer costs.

02:15 PM -- Scott Lloyd, Division of Insurance in the Department of Regulatory Agencies, testified in support of the bill. Mr. Lloyd responded to questions about how reserves are held by an insurance company and the fiscal note. He responded to questions about the current reporting requirements for life insurance companies to the Division of Insurance.

02:21 PM -- John Postolowski, Division of Insurance in the Department of Regulatory Agencies, testified in support of the bill. He discussed modernizing the reserve requirements for life insurance policies. Mr. Postolowski responded to questions about whether a consumer could change policies if his or her premiums are increased.

02:25 PM -- Henry Freaney, Division of Insurance in the Department of Regulatory Agencies, testified in support of the bill.

02:26 PM

Representative Williams made closing remarks about the bill.
BILL:HB15-1048
TIME: 02:27:03 PM
MOVED:Landgraf
MOTION:Refer House Bill 15-1048 to the Committee on Appropriations. The motion passed on a vote of 13-0.
SECONDED:Brown
VOTE
Brown
Yes
Esgar
Yes
Humphrey
Yes
Joshi
Yes
Klingenschmitt
Yes
Landgraf
Yes
Lontine
Yes
Mitsch Bush
Yes
Primavera
Yes
Ransom
Yes
Ryden
Yes
Ginal
Yes
McCann
Yes
Final YES: 13 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: PASS