2014 indiana legislative update # 7

8/12/2019 2014 Indiana Legislative Update # 7

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Legislative ReportFebruary 21, 2014 BOSE PUBLIC AFFAIRS GROUP INSURANCE

BULLETIN XIV, NUMBER 7

In This Issue

General Assembly Overview Unclaimed Life Insurance Benefits IDOI Bill Tax Credits Electronic Delivery of Insurance

Documents

Motor Vehicle FinancialResponsibility

Pollution Exclusion Lawsuit Lending Workers Comp Abortion Coverage Mandate Biosimilar Drug Bill Welfare Drug Testing

Useful Links

House Committee Schedule

Senate Committee Schedule

Contact Your Legislator

Indiana Register

Contact Us

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Indianapolis, IN 46204317-684-5400www.bosepublicaffairs.com

GENERAL ASSEMBLY OVERVIEW

Many committees held their final meeting of the 2014 session this week, while a

few others continue to hold hearings on a variety of legislation. The House

committee report deadline is Tuesday and the Senate committee report deadline

is Thursday.

Indiana State Fair guests might soon be able to purchase and consume alcohol at

the annual event. Senate Bill 339 repeals a state law prohibiting alcohol sales

during the Indiana State Fair. Alcohol is sold on the state fairgrounds at various

events during the rest of the year. The State Fair Commission will be in charge of

crafting a responsible program of alcohol sales at the fair, including location, hours

and more. Fair officials have said the fair would focus on the agricultural link to

Indiana wine, beer and spirits and will be contained in a confined area where the

alcohol could be consumed.

As reported in last week's overview, in a rare move Governor Pence testified in

front of the Senate Education Committee in support of House Bill 1004. The

proposed legislation passed overwhelmingly by the House created a framework

for a preschool pilot program. It would have served about a thousand four-year-

olds in five counties, with funding to kick in next year. However, this week the

Senate Education Committee approved an amendment that instead sends theissue to an interim study committee this summer. The study will review several

facets of pre-k education, including corporate partnership possibilities, parental

involvement and preschool standards in other states.

House Joint Resolution 3 has hit the end of the road for the 2014 session as the

measure received third reading approval in the Senate by a vote of 32-17. This

vote ensures that there will not be a ballot question in 2014 whether Indiana

should include the definition of marriage as one man and one woman in the

constitution. As you may recall, the House voted to remove the second sentence

of HJR 3 which would have banned civil unions. The Senate did not add back the

second sentence so that language failed to pass either house. The resolution

would not be able to go to voters until 2016 at the earliest, since proposed

constitutional amendments have to pass two consecutive, separately elected

legislatures with the exact same wording.

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UNCLAIMED LIFE INSURANCE BENEFITS

SB 220,authored by Sen. Travis Holdman (R), requires insurers to use
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Affairs Group on Twitter @BosePAG orvisit

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the SSAs Death Master File or a database as inclusive to help with

the accurate administration of unclaimed death benefits for policies

and contracts issues or entered into after June 30, 2015.

During committee, the AGs office expressed concern that with the

prospective language it would only allow the AG to conduct audits

on policies issued after June 30, 2015. The AGs office offered a

clarifying amendment, which would give them the power to

continue conducting audits on all inforce policies. The amendment

was rejected and the bill passed out of committee with theprospective language.

However, discussions between the author, AGs office and life

industry continue. It appears that the bill may be amended back to

its original form, i.e., applies to all in-force policies and contracts.

IDOI BILLHB 1206,authored by House Insurance Chairman Matt Lehman (R),

does the following: (1) removes a requirement for life insurers to

submit individual investments to the Department of Insurance; (2)removes a requirement that a foreign or alien insurer submit an

application for admission to do business in Indiana in duplicate; (3)

changes from March 15 to July 1 of each year the due date for

certain insurance holding company filings; (4) adopts ORSA; (5)

repeals a provision requiring the Commissioner to examine and

publish a foreign or alien insurers annual condensed statement of

assets and liabilities; and (6) specifies requirements for service

contracts.

The bill was heard in Senate Insurance Committee yesterday and

was amended in committee to include (1) removal of IC 27-1-13-

16(c) regarding the requirement to stamp envelope if residential

policy if coverage has been reduced, restricted or removed; (2) a$2,500 registration fee for captive insurers doing business in Indiana;

(3) clarifying language regarding service contracts.

As amended, the bill passed out of committee 8-1.

TAX CREDITS LIKELY HEADED TOCONFERENCE COMMITTEE

SB 367,originally filed as a property tax bill, was amended late in the

Senate committee process and now includes a sunset on numerous

tax credits; including, a sunset of the following: Indiana Life andHealth Guaranty Association Tax Credit (12/31/17), Indiana Insurance

Guaranty Association Tax Credit (12/31/17) and the Indiana

Comprehensive Health Insurance Association Tax Credit (1/1/17). A

repeal of these credits will certainly have a negative financial impact

on insurers that have already paid assessments and that have

assessments coming in the future.

The bill was heard in Ways and Means on Tuesday morning. At the

start of the committee hearing, Chairman Brown indicated he was

going to remove all the credit sunsets from the bill. Currently, the bill

still remains in Ways and Means and the sunsets have not been
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removed from the bill. The bill is scheduled to be heard again on

Monday.

As a result of Chairman Browns intention to remove the credit

sunsets, Sen. Hershman (Chair of the Senate Tax & Fiscal Committee

and author of SB 367), placed all the credit sunsets inHB 1020with a

revised sunset date of 1/1/20. HB 1020 passed out of Senate Tax &

Fiscal while the above mentioned Ways and Means was going one.

HB 1020 was engrossed on second reading in the Senate yesterday

and will be on third reading next week.

Were told indiscussions with key leaders that this language is not

likely to survive as they understand the substantial negative effect of

allowing these credits and offsets to expire but were workingclosely

with legislators to make sure that happens.

ELECTRONIC DELIVERY OF INSURANCE

NOTICES AND DOCUMENTS

HB 1058(Rep. Peggy Mayfield) provides for the electronic delivery of

insurance notices and documents instead of other modes of delivery

otherwise required for such notices and documents. The bill requires

a recipient's consent to electronic delivery and a method to

withdraw consent. It also includes provisions regarding electronic

posting of documents on an insurers website.

The bill passed out of the Senate Insurance Committee unanimously

on Thursday.

MOTOR VEHICLE FINANCIAL

RESPONSIBILITYHB 1059(Rep. Matt Lehman) makes various changes to the motor

vehicle financial responsibility law, including the: (1) definition of

"registration" to include the license plate issued in connection with

the registration of a vehicle; (2) requirement of proof of financial

responsibility and reinstatement fees; (3) suspension of a registration

as a consequence of operation of the vehicle without financial

responsibility in effect; and (4) requirement of proof of future financial

responsibility for five years related to operating a vehicle without

financial responsibility in effect. The introduced version of this bill was

prepared by the interim study committee on insurance.

The bill was heard on Tuesday in the Senate Homeland Security,

Transportation, and Veterans Affairs Committee and passed by a

vote of 6-0.

POLLUTION EXCLUSION

HB 1241,authored by Rep. Martin Carbaugh (R), is a resurrection of

last sessions HB 1269, which clarifies when environmental coverage is

excluded from a commercial general liability insurance policy.

Amendments were adopted on second reading in the House which

include additional consumer notification provisions as well as
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language that would apply the bill prospectively. The bill is

scheduled for hearing next Thursday (2/27) in the Senate Insurance

Committee.

LAWSUIT LENDING

HB 1205,authored by House Chairman Matt Lehman (R), regulates

the practice of lawsuit lending subject to the jurisdiction of the

Indiana Department of Insurance. It caps the interest rate at 38%.The bill has been removed from the Senate Civil Law Committee

schedule and the author may be looking for another home to

advance the bill.

WORKERS COMP

SB 294(an encore to HEA 1320 from last year) contains more

restrictive language relative to repackaged drugs, clarification with

respect to the definition of a medical service provider, and

prohibition of double billing for implants. The bill passed out of the

House Employment and Labor committee this week. It was then

amended on the House floor by Rep. Lehman to remove languagerequiring company officers to be covered by workers comp. As

amended, the bill was engrossed on second reading.

ABORTION BILL AMENDED, MOVES

FORWARD

A bill requiring that abortion coverage is offered only as a separate

rider to a major medical policy was heard in the Senate Insurance

Committee Thursday and amended to accommodate insurer

compliance timeframe.

HB 1123mandates that abortion coverage be offered as an election

to a health plan and not a part of essential coverage. The effective

date is July 1, 2014 for the law and as it passed the House the bill

required that plans renewed on or after June 30, 2014 reflect the new

offering mandate.

Some insurers were concerned this timeframe was too aggressive to

accommodate the system updates required to implement the

policy. The committee changed the effective date for compliance

to plans offered on or after January 1, 2015.

BIOSIMILAR BILL PASSES HOUSECOMMITTEE

A biosimilar substitution bill that has been historically controversial

passed the House Public Health Committee 11-0 on Wednesday.

SB 262establishes a process by which a pharmacist could substitute a

brand name drug for a biosimilar. The substitution is limited to drugs

the FDA has determined are interchangeable and can only occur if

a prescriber permits substitution on the prescription. The pharmacist

must also notify the physician of the substitution within five days.
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The bill will be on the House floor for amendment and final vote next

week. No changes were made in the House committee so if none

are made on the floor the bill will go straight to the governor.

WELFARE DRUG TESTING BILL SCALED

BACK

A bill placing limits on benefits for people receiving TANF benefits was

scaled back in the Senate this past week.HB 1351originally required

FSSA to administer a drug testing program and curb benefits for those

who test positive for drugs. A similar bill nearly passed in 2013 but was

derailed in the late hours of the final night of the session in the

Senate.

This week the bill was watered down and drug testing requirements

under the bill as currently written will apply only to those who have a

misdemeanor drug conviction in the past ten years. They will be

required to take a drug test upon qualifying for benefits and annually

as they continue in the program.

Democratic Senators continue to oppose the measure; the bill

now moves to the Senate for further amendment.

For more informationTrent Hahn

[email protected] OBrien

[email protected]

Telephone: 317/684-5400

Fax: 317/684-5432
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