Legislature(2025 - 2026)BARNES 124
04/04/2025 03:15 PM House LABOR & COMMERCE
Note: the audio ![]()
and video ![]()
recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.
| Audio | Topic |
|---|---|
| Start | |
| HB148 | |
| HB60 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | HB 148 | TELECONFERENCED | |
| += | HB 60 | TELECONFERENCED | |
HB 148-OMNIBUS INSURANCE BILL
3:19:33 PM
CO-CHAIR HALL announced that the first order of business would
be HOUSE BILL NO. 148, "An Act relating to insurance; and
providing for an effective date."
3:20:03 PM
REPRESENTATIVE SADDLER asked which provisions of HB 148 were
absolutely necessary and what might happen if the proposed
legislation was not passed.
3:20:36 PM
LORI WING-HEIER, Director, Division of Insurance, Department of
Commerce, Community & Economic Development (DCCED), replied that
there are a few sections related to the Division of Insurance's
accreditation. She explained that the division was judged on
how well it examined the financial status of insurance companies
in line with the 55 other jurisdictions under the National
Association of Insurance Commissioners (NAIC). She further
explained that accreditation means that companies in Alaska can
do business in other states with the security of solvency. She
stated that the division must meet or exceed national standards
to retain accreditation. She repeated that there are some
sections in the proposed legislation that address updates to
accreditation standards.
MS. WING-HEIER further stated that there are some provisions of
HB 148 regarding licensing updates for efficiency and noted that
the division was not licensing people that "should have been
licensed." She noted that there were quite a few technical
changes in the proposed legislation as well to correct Alaska
Statute (AS). She stated that were HB 148 not to pass, the
division would request it again as the proposed fixes to Title
21 are important. She surmised that barring the accreditation
standards, no one section of the proposed legislation was more
important than the other. She stated that the staff at the
division felt that the proposed legislation was necessary to be
more efficient and more effective at protecting consumers. In
response to a follow-up question, she identified Sections 4, 5,
8, 9, 10, and 11 as dealing with accreditation standards.
3:23:31 PM
REPRESENTATIVE COULOMBE referring to the sectional analysis of
HB 148, citing "to align with NAIC model law 786," and asked
whether this section had to do with accreditation.
MS. WING-HEIER replied that the reason for model law was that
insurance companies would like to see that the laws are similar
or identical across all 50 states. She stated that NAIC does
spend time adopting model laws, and that it functioned similarly
to the legislature. She further stated that the National
Council of Insurance Legislatures (NCOIL) functions in the same
way. She noted that model law 786 refers to a licensing bill.
3:25:07 PM
The committee took a brief at-ease at 3:25 p.m.
3:25:26 PM
REPRESENTATIVE CARRICK noted there was concern regarding the
controlled insurance programs (CIPs) that would restrict the use
of CIPs to projects valued at $50 million or more.
MS. WING-HEIER reported that many years ago, the State of Alaska
was in a lawsuit with Alyeska Resort, and the current statutes
are a result of that lawsuit. She explained that current
statues require that an owner- or contractor-controlled
insurance program must be approved by the division.
Additionally, it must be over $50 million dollars with a
definitive length of time and location. She explained that CIPs
were purchased by either the owner or contractor of a major
project, which buys all of the insurance, including workers'
compensation, general liability, equipment, et cetera. She
noted it was money-saving for large projects. She reported that
a few years ago, she was told that the division could not
approve CIPs because current AS, as a result of the lawsuit with
Alyeska, was not written correctly. She offered her belief that
it was not the intent of the court case to prohibit CIPs;
rather, statute declared that there could not be "additional
insured." She explained that the division corrected the statute
to allow additional insured to correct what it believed was an
error when the statute was first passed.
MS. WING-HEIER stated that there was an amendment for multi-
residential projects floating around the Capitol building that
had passed in the other legislative body. She explained that
the amendment allowed CIPs at a lesser limit of $25 million,
with a requirement of at least 50 units and at least three
owners. She commented that the division felt the lesser limits
of $5 million or $10 million were too low for insurance
companies.
3:29:20 PM
REPRESENTATIVE CARRICK asked whether the revised threshold of
$25 million was too low.
MS. WING-HEIER opined that $25 million was a fair compromise and
noted the division was satisfied.
3:29:53 PM
REPRESENTATIVE BURKE referred to Section 6 and Section 62 of the
proposed legislation where wet marine transportation contracts
were previously excluded. She queried the justification for the
prior exclusion, citing "the State of Alaska is losing $300,000
in tax revenue."
MS. WING-HEIER replied that she did not know why the wet marine
transportation contracts were given an exclusion, but it goes
back years.
3:31:02 PM
HEATHER CARPENTER, Deputy Director, Division of Insurance,
Department of Commerce, Community & Economic Development,
replied that she had provided a written answer to Representative
Burke's question earlier in the week.
3:31:16 PM
REPRESENTATIVE SADDLER reiterated that $5 million or $10 million
CIPs were too low and asked who, business or insurers, would be
driven out of business.
MS. WING-HEIER clarified that it would not drive companies out
of business or drive businesses out of Alaska but explained that
the division was concerned about too much payroll or revenue
being taken from small contractors with numbers like $5 million
or $10 million. She noted that insurance companies have minimum
premiums, and small contractors may have a hard time finding
someone to write their insurance with numbers like $5 million or
$10 million.
3:32:16 PM
CO-CHAIR HALL referred to Section 53 of the proposed legislation
describing depreciation of labor and asked why depreciation of
labor was allowed in the first place.
MS. WING-HEIER answered that she missed it in a few insurance
policy forms stating that there would be depreciation of labor.
She reported that the division received complaints and talked to
colleagues in other states and found that states are adopting
measures to address the depreciation of labor. She stated that
when taken out completely, the division received some
resistance. She further stated that the division settled on an
amendment that would allow for conditional depreciation of
labor. She explained that an individual can choose to purchase
an insurance policy with labor depreciation to save money.
3:34:26 PM
REPRESENTATIVE SADDLER confirmed that under the proposed
legislation, an individual could lower their premium by taking a
higher deductible or lower coverage limits. He surmised that an
individual could take "a little hit" to make [insurance] more
affordable.
MS. WING-HEIER confirmed that was correct.
3:34:47 PM
CO-CHAIR HALL referred to Section 58 of HB 148 and queried the
history of health maintenance organizations (HMOs).
MS. WING-HEIER replied that the division has allowed HMOs for
years. She explained that HMOs are managed care, and because of
the high cost of healthcare, the division allowed HMOs as an
option for employers to purchase if it would reduce costs.
3:36:00 PM
REPRESENTATIVE SADDLER asked whether there were other amendments
or policy additions that existed for consideration that might
affect the proposed legislation.
MS. WING-HEIER replied that the Senate version of HB 148 had
passed out of one committee in the other body with two
amendments regarding the depreciation of labor and the change to
owner-controlled insurance programs. She stated that she had
not seen any other amendments or policy additions.
REPRESENTATIVE SADDLER commented that he had heard talk of
trying to repeal the 80th percentile rule and thanked Ms. Wing-
Heier.
3:37:14 PM
CO-CHAIR HALL thanked the invited testifiers.
[HB 148 was held over.]
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB148 Additional Document - DOI Response to HLC 4.2.25.pdf |
HL&C 4/4/2025 3:15:00 PM HL&C 4/23/2025 9:00:00 AM |
HB 148 |