House Committee on Business Affairs and Labor (03/22/2006)

Final
STAFF SUMMARY OF MEETING

HOUSE COMMITTEE ON BUSINESS AFFAIRS AND LABOR

Date:	03/22/2006	ATTENDANCE

Time:	12:13 PM to 01:59 PM	Balmer	X
		Borodkin	X
Place:	HCR 0107	Butcher	*
		Carroll M.	X
This Meeting was called to order by		Coleman	X
	Representative Marshall	Knoedler	X
		Liston	X
This Report was prepared by		McCluskey	X
	Christie Lee	Paccione	E
		Penry	X
		Welker	A
		Cerbo	X
		Marshall	X
		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
SB06-113 HB06-1330		Amended, Referred to the Committee of the Whole Amended, Referred to Finance

12:14 PM -- Senate Bill 06-113

Representative Massey, prime sponsor, presented Senate Bill 06-113. He stated the bill would prohibit life insurance companies from discriminating solely for reasons associated with an insured's past or future lawful foreign travel.

12:18 PM -- Jim Hall, representing the American Council of Life Insurers, stated that he was neutral on the bill. He stated the proposed amendment clarifies and strengthens Colorado law on foreign travel. Mr. Hall talked about the Unfair Trade Practices Act and how it currently provides protections for consumers. Mr. Hall responded to questions.

12:23 PM -- David Foster, representing the Jewish Community Relations Council, testified in support of the bill. He stated that the Anti-Defamation League brought this issue to his attention, specifically regarding travel to Israel. Mr. Foster explained that policies have been denied based on a consumer's intentions to travel to Israel, and lawful travel to other countries. Mr. Foster said policies should be based on what the activities a person participates in, and not what countries they chose to travel to. Mr. Foster briefly spoke about amendment L.006 (Attachment A).

12:30 PM -- Jason Williamson, representing himself, testified in favor of the bill. He stated that he and his wife were denied coverage based solely on their future plans to travel to Israel. He later found one company that would insure them with a $1,000 a year additional charge, at a total rate of $1,433 a year. He said that penalizing citizens based on foreign travel is discriminatory. Mr. Williamson responded to committee questions about whether there are any other countries where coverage is denied if one were to travel to them. Mr. Williamson stated that there are other countries such as Iraq.

12:34 PM -- Paula Romer, representing Faith Bible Chapel, testified in support of the bill. She stated that she was there to speak on behalf of Cheryl Morrison who could not attend. She talked about Faith Bible Chapel's faith-based tours to Israel. Ms. Romer stated that of all the church's tours to Israel, there have been nothing but minor problems such as bee stings that have occurred.


BILL:	SB06-113
TIME:	12:38:50 PM
MOVED:	Knoedler
MOTION:	Moved amendment L.006 (Attachment A). The motion passed without objection.
SECONDED:	McCluskey
		VOTE
	Balmer
	Borodkin
	Butcher	Excused
	Carroll M.
	Coleman
	Knoedler
	Liston
	McCluskey
	Paccione	Excused
	Penry
	Welker	Absent
	Cerbo
	Marshall
Not Final YES: 0 NO: 0 EXC: 3 ABS: 1 FINAL ACTION: Pass Without Objection


BILL:	SB06-113
TIME:	12:40:12 PM
MOVED:	Borodkin
MOTION:	Moved to refer Senate Bill 06-113, as amended, to the Committee of the Whole. The motion passed 11-0.
SECONDED:	Penry
		VOTE
	Balmer	Yes
	Borodkin	Yes
	Butcher	Yes
	Carroll M.	Yes
	Coleman	Yes
	Knoedler	Yes
	Liston	Yes
	McCluskey	Yes
	Paccione	Excused
	Penry	Yes
	Welker	Absent
	Cerbo	Yes
	Marshall	Yes
Final YES: 11 NO: 0 EXC: 1 ABS: 1 FINAL ACTION: PASS

12:41 PM -- House Bill 06-1330

Representative Romanoff, prime sponsor, presented House Bill 06-1330. The bill was previously heard in the House Business Affairs and Labor Committee on February 17, 2006. The bill would require property and casualty insurers to report certain claim and expense information to the Insurance Commissioner within the Department of Regulatory Agencies (DORA), and to make the same available to the public. Representative Romanoff distributed a handout (Attachment B) and amendment L.004, a strike below to the bill (Attachment C). Amendment L.004 was moved by Representative Coleman and seconded by Representative Morgan Carroll for discussion.

Representative Romanoff explained that amendment L.004 would limit the claim information insurers must submit to Colorado specific information. He also talked about amendment L.008 (Attachment D) that would strike section four of the strike below because it is duplicative, it gives the Insurance Commissioner authority he or she already has.

12:51 PM -- Victoria Lusk, Chief Actuary of the Colorado Division of Insurance, stated that with the amendments that are being proposed, the division is no longer in full opposition of the bill. However, she stated that she would like to discuss why the division feels that the information requested by the bill is unnecessary. Ms. Lusk stated that with the strike below, the bill would require all insurers to provide a Colorado specific Schedule P for specific lines of insurance. She explained that Schedule P information is inadequate for rate making for the following reasons:

Schedule P only requires information by line, where rate making requires information be provided by form, subline, and class;
the information in Schedule P is dated and frequently does not have sufficient credibility for rate making; and
Schedule P data does not include any information that would allow for the evaluation of certain important factors in rate making such as: trend, operational changes, changes in the laws, benefits, taxes and licensing fees.

Ms. Lusk stated that past data cannot be used to determine whether future rates are properly determined.

01:07 PM

Representative Romanoff stated that although the information required in the strike below would not be useful to Ms. Lusk in doing her job, it has been found that this type of information has been of use for consumers and policy makers in other states. Ms. Lusk stated that the reason the division is now neutral on the bill is because with the strike below, the bill neither causes harm nor is necessary. There was committee discussion about the liability grouping. She responded to questions from the committee.

01:27 PM -- Jay Angoff, former Insurance Commissioner of Missouri, testified in support of the bill. He stated that Colorado and Missouri are similar because neither state heavily regulates insurance. Mr. Angoff added that when there is not much regulation, it is important to have complete disclosure. He stated that the bill would hold actuaries accountable and that a Schedule P is the only way to go back and see how accurate the actuary was in keeping reserves. There was committee discussion about whether consumers would be able to use the data provided under the bill. Mr. Angoff responded to questions from the committee.

01:41 PM -- Rex Wilmouth, representing the Colorado Public Interest Research Group (CoPIRG), testified in support of the bill. He stated that CoPIRG would like to take the information provided by insurance companies under the bill, and disseminate it out to the public so consumers can understand what is going on with insurance rates. Mr. Wilmouth stated that the bill will increase transparency and allow interested persons to see where insurance rates are going.

01:43 PM -- Steve Rubin, Copic Insurance Company, stated that Copic is neutral on the strike below. He stated that the strike below is a substantial improvement to the original bill. Mr. Rubin responded to some of Ms. Lusk's previous testimony. He stated that Copic is a nonprofit company, and if they get their insurance rates wrong, then they refund that money back to their consumers.

01:46 PM -- Bill Imig, representing the Property and Casualty Insurers Association of America, testified in opposition to the bill. He stated they are still concerned about small companies and whether the information will be useful to consumers. He stated they are neutral on the bill with the proposed amendments. Mr. Imig responded to a question about whether the requested in the bill would include any proprietary information. Mr. Imig stated that the information would come from a Schedule P that is already public.

01:48 PM -- Rich Gebhardt, representing State Farm Insurance, stated that he does not oppose the bill with the amendments.


BILL:	HB06-1330
TIME:	01:51:37 PM
MOVED:	Coleman
MOTION:	Moved amendment L.004 (Attachment C). The motion passed without objection.
SECONDED:	Carroll M.
		VOTE
	Balmer
	Borodkin
	Butcher
	Carroll M.
	Coleman
	Knoedler
	Liston
	McCluskey
	Paccione	Excused
	Penry
	Welker	Absent
	Cerbo
	Marshall
Not Final YES: 0 NO: 0 EXC: 1 ABS: 1 FINAL ACTION: Pass Without Objection


BILL:	HB06-1330
TIME:	01:53:21 PM
MOVED:	Coleman
MOTION:	Moved amendment L.008 (Attachment D). The motion passed without objection.
SECONDED:	Butcher
		VOTE
	Balmer
	Borodkin
	Butcher
	Carroll M.
	Coleman
	Knoedler
	Liston
	McCluskey
	Paccione	Excused
	Penry
	Welker	Absent
	Cerbo
	Marshall
Not Final YES: 0 NO: 0 EXC: 1 ABS: 1 FINAL ACTION: Pass Without Objection


BILL:	HB06-1330
TIME:	01:51:50 PM
MOVED:	Coleman
MOTION:	Moved amendment L.007 (Attachment E). The motion passed without objection.
SECONDED:	Butcher
		VOTE
	Balmer
	Borodkin
	Butcher
	Carroll M.
	Coleman
	Knoedler
	Liston
	McCluskey
	Paccione	Excused
	Penry
	Welker	Absent
	Cerbo
	Marshall
Not Final YES: 0 NO: 0 EXC: 1 ABS: 1 FINAL ACTION: Pass Without Objection


BILL:	HB06-1330
TIME:	01:57:45 PM
MOVED:	Coleman
MOTION:	Moved to refer Senate Bill 06-1330, as amended, to the Committee on Finance. The motion passed 9-2.
SECONDED:	Liston
		VOTE
	Balmer	No
	Borodkin	Yes
	Butcher	Yes
	Carroll M.	Yes
	Coleman	Yes
	Knoedler	Yes
	Liston	Yes
	McCluskey	No
	Paccione	Excused
	Penry	Yes
	Welker	Absent
	Cerbo	Yes
	Marshall	Yes
Final YES: 9 NO: 2 EXC: 1 ABS: 1 FINAL ACTION: PASS

01:59 PM

The committee adjourned.