Legislature(2023 - 2024)BUTROVICH 205
05/03/2024 01:30 PM Senate JUDICIARY
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| Audio | Topic |
|---|---|
| Start | |
| HB29 | |
| HB97 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 29 | TELECONFERENCED | |
| + | HB 97 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HB 29-INSURANCE DISCRIMINATION
[SCS CSHB 29(L&C) was before the committee.]
2:25:28 PM
CHAIR CLAMAN announced the consideration of CS FOR HOUSE BILL
NO. 29(JUD) am "An Act prohibiting certain insurance decisions
based solely on a person's status as an elected official."
2:26:05 PM
REPRESENTATIVE KEVIN MCCABE, District 30, Alaska State
Legislature, Juneau, Alaska, asserted that insurance companies
discriminate based on risk-profile differences. This
discrimination allows insurers to segregate the insured, thus
enabling the insurer to vary premium charges by group (based on
the group's associated risk) and to incentive risk reduction. He
noted that there are limits to the types of discrimination that
insurers can engage in; these limits are decided at both the
federal and state level and vary greatly. He stated that
insurance companies have denied Alaskans coverage based on
political affiliation, expression, and/or elected status. HB 29
would end these types of discriminatory practices. He explained
that an amendment in the [Senate Labor and Commerce Standing
Committee] expanded the scope of protection to members of
Alaska's congressional delegation. He paraphrased the following
sponsor statement:
HB 29
SPONSOR STATEMENT
"An Act relating to insurance discrimination."
HB29 seeks to prohibit insurers from discriminating
against individuals on the basis of their political
affiliation or expression.
HB29 amends the Insurance Code to prohibit a person
from taking any of the following actions because of an
individual's political affiliation or expression:
• refuse to insure or renew insurance coverage;
• limit the scope of insurance coverage;
• Cancel an existing policy of insurance;
• Deny a covered claim; or
• Increase the premium, policy fees or rates
charged on an insurance policy.
A person does not violate this prohibition if the
refusal, limitation, or charge is based on sound
underwriting or actuarial principles reasonably
related to actual or anticipated loss experience or is
required or authorized by law or a regulatory mandate.
Given that insurance products are critical to
protecting property and health, it is in the public
interest to ensure that consumers are protected from
discriminatory practices contrary to the foundational
values of our democracy.
REPRESENTATIVE MCCABE explained that HB 29 arose from personal
experience. He shared his story and stated that he was denied an
umbrella policy because he was an elected official. He explained
that many companies do not offer umbrella policies to elected
officials (from the school board level through to the
congressional delegation level).
2:30:18 PM
JULIE MORRIS, Staff, Representative Kevin McCabe, Alaska State
Legislature, Juneau, Alaska, presented the sectional analysis
for HB 29:
[Original punctuation provided.]
Section 1 amends Sec. 21.36 to add a new section that
prohibits a person transacting insurance in this state
from discriminating against a person based solely on a
person's political affiliation or expression or a
person's status as an elected state official as
defined in AS 44.99.205.
Section 2 amends uncodified law of the State of Alaska
by adding a new section regarding applicability and
effective dates to insurance policies and/or
contracts.
2:30:33 PM
SENATOR KIEHL joined the meeting.
MS. MORRIS said the Senate Labor and Commerce Committee amended
HB 29.
2:31:28 PM
CHAIR CLAMAN sought clarification that those changes were made
in the Senate Labor and Commerce Committee.
MS. MORRIS replied yes.
CHAIR CLAMAN asked if those changes were made in version U.A.
MS. MORRIS replied yes.
CHAIR CLAMAN said that if the changes made in Senate Labor and
Commerce Standing Committee were in the version of HB 29 that is
before the committee, then no further explanation is needed.
2:31:51 PM
REPRESENTATIVE MCCABE corrected a misstatement in his previous
testimony; he stated that the Senate Labor and Commerce (SL&C)
was the first committee to hear CSHB 29(JUD) am, version U.A, in
the Senate. He explained that SL&C adopted an amendment adding
the congressional delegation verbiage.
2:32:07 PM
CHAIR CLAMAN clarified that version U.A. does not have the
congressional delegation update, so the updated, amended version
must contain the change.
2:32:22 PM
SENATOR KIEHL shared his understanding that SL&C heard (and
amended) CSHB 29(JUD). The resulting Senate committee substitute
(SCS) is version Y, which contains the congressional delegation
language. He clarified that version Y is before the committee
for consideration.
SENATOR KIEHL asked whether HB 29 applies to all insurance or is
limited to a particular category of insurance.
2:32:55 PM
REPRESENTATIVE MCCABE replied that the change applies to all
insurance. He explained that if a form of insurance is offered
to the general public, then it must also be offered to elected
officials. He said that there must be a sound actuarial reason
to exclude or charge more and indicated that being an elected
official is not a sound actuarial reason.
2:34:20 PM
SENATOR KIEHL expressed his appreciation and agreement that
denials should not be allowed. He noted that HB 29 also
prohibits higher insurance premiums. He shared a hypothetical
scenario in which Alaska's elected officials share a common
ailment that results in increased health costs (which would
normally result in an increased insurance premium). He asked if
this would be forbidden by HB 29.
REPRESENTATIVE MCCABE replied no. He explained that any decision
regarding rate-making that is based on sound underwriting or
actuarial principles would be allowed. He briefly explained the
process of determining whether these decisions are sound.
2:36:48 PM
SENATOR KIEHL commented that he is considering whether the
Division of Insurance should also consider underwriting that
relates to other areas.
2:37:05 PM
CHAIR CLAMAN commented that, if an insurance company could show
that elected officials submit more claims, the elected official
could be charged a higher premium but could not be denied
coverage.
REPRESENTATIVE MCCABE said that is correct.
2:37:43 PM
CHAIR CLAMAN opened public testimony on HB 29; finding none, he
closed public testimony.
2:38:07 PM
CHAIR CLAMAN held HB 29 in committee.