Legislature(1995 - 1996)
03/27/1996 03:11 PM House L&C
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 197 - INS: DOMESTIC VIOL. VICTIMS & DISCLOSURES
CHAIRMAN KOTT brought SB 197 before the committee and noted it had
been heard before. He opened public testimony for Becky Achten,
who had not testified previously.
Number 1982
BECKY ACHTEN, Children's Counselor, Aiding Women from Abuse and
Rape Emergency (AWARE), testified in support of SB 197. She
stated, "I've read that half of the 16 major insurance companies
use domestic violence as a criteria to deny coverage or increase
rates for victims. This says to me that insurance companies
recognize the economic cost of domestic violence in this country.
But in order to resolve this economic problem, insurance companies
re-victimize the victim. Failure to pass this bill in a form which
ensures its intent to protect victims of domestic violence from
discrimination, which would deny them medical coverage or raise
their rates, is also a re-victimization. The problem is domestic
violence. The question is: Are we going to recognize the gravity
of this problem by allowing insurance companies to deny coverage to
victims, or are we going to address the problem [of] domestic
violence and support Senate Bill 197 and others before you aimed at
protecting victims, perhaps protecting them before they are
injured? Shame on the insurance companies for denying coverage or
raising their rates to those who have suffered injuries. I invite
them to join and unite and address the root cause of the problem,
domestic violence."
CHAIRMAN KOTT noted there was a committee substitute that had not
yet been adopted as a work draft, which added "or as required by
the division of insurance" at the bottom of page 1.
REPRESENTATIVE PORTER pointed out there were additional changes.
CHAIRMAN KOTT called an at-ease at 4:43; the meeting resumed
shortly thereafter.
Number 2181
REPRESENTATIVE KUBINA moved that the committee adopt the work draft
for SB 196, version M, dated 3/26/96.
REPRESENTATIVE ROKEBERG objected for purposes of discussion.
REPRESENTATIVE PORTER noted that Chairman Kott had mentioned the
addition on page 1. He said the major change was a suggestion he
had worked out with the sponsor, which changed the disclosure
requirement. Instead of an insurance company being required to
automatically provide that information upon denial, the company
would advise anyone they denied of their right to have that
information and if they received written notification, provide it.
Number 2332
REPRESENTATIVE ROKEBERG withdrew his objection.
CHAIRMAN KOTT noted the committee substitute for CSSB 197, version
M, dated 3/26/96, was before them.
Number 2353
REPRESENTATIVE ROKEBERG offered an amendment, which read:
Section AS 21.36 is amended by adding new sections to read:
Sec. 21.36.430 INSURANCE FOR DOMESTIC VIOLENCE VICTIMS;
(a) An insurer offering life, disability or health
insurance in Alaska may not discriminate against a victim of
domestic abuse based on an individual's status as a victim of
domestic abuse. This prohibition shall not prevent an insurer
from underwriting or rating for a medical condition in the
same manner as they would for an insured or applicant who is
not a victim of domestic abuse.
(b) This section applies only to an insured or applicant
for insurance.
(c) An insurer is granted immunity for criminal or civil
liability resulting from compliance with this statute.
REPRESENTATIVE ROKEBERG stated he had provided letters from eight
or nine insurance companies throughout the country. "This was an
amendment that was in Mr. Lessmeier's letter, I believe, of
March15," he said, commenting that was in the packet and
duplicated a recommendation by State Farm. "We've heard testimony
from the bill sponsor that he does not care for this language," he
said. "But we also heard testimony in this committee that the
insurance industry was duly informed, and so forth, and had no
objections to this bill. And the letters you have in hand directly
oppose what that testimony was. And I'd like to take exception to
that." He listed the insurance companies that had provided
letters.
TAPE 96-31, SIDE A
Number 0001
REPRESENTATIVE ROKEBERG said, "What we don't want to do, I think,
particularly, and that's our charge in this committee, is to
provide additional burdens on the insurance industry that are not
called for by any other type of classification of citizenry in this
country. This is an extraordinary demand and I don't think we need
to do that to accomplish the purpose of this bill. And I
particularly take exception to the fact that ... the insurance
industry was duly represented at this table or in the Senate,
because to my knowledge, they weren't. And these letters speak for
that case. So, that's why I'm bringing the amendment. Also, the
amendment includes a deletion of the committee substitute section
(b), based on confidentiality. Mr. Lessmeier's letter of
March20th in your package clearly sets forward the lack of
necessity of having this in the bill." He specified he was
referring to Section 1, subsection (b).
REPRESENTATIVE ELTON objected and then asked if Representative
Rokeberg had moved the amendment.
REPRESENTATIVE ROKEBERG moved the amendment.
REPRESENTATIVE KUBINA asked to hear from the sponsor.
Number 0185
SENATOR DAVE DONLEY, sponsor of SB 197, said after consulting with
the Division of Insurance, he believed he could speak for them, as
well. "We oppose this amendment for at least three reasons," he
stated. "Number 1, it excludes specific lines of insurance from
coverage. I guess if I was State Farm, I wouldn't want to have to
live under any new rules, either. But this would say property is
no longer covered by the bill."
SENATOR DONLEY pointed out the committee had heard "horrific
examples of discrimination against victims of domestic violence in
property lines of insurance". He referred to the victim of an
arson attack, discussed in earlier testimony, whose insurance was
subsequently cancelled. He referred to subsection (b) of the
amendment, which said, "This section applies only to an insured or
applicant for insurance." He said a third-party beneficiary could
be discriminated against on the basis of domestic violence, which
he believed was completely improper, as there may be other classes
of people who need protection from discrimination.
SENATOR DONLEY said third, the amendment granted blanket immunity
that did not appear anywhere else in the insurance code for any
other action required of insurance companies. Although insurance
companies had prohibitions against discrimination for reasons of
race and religion, for example, there was no blanket immunity for
any criminal or civil liability. "No matter how they administer
it, how grossly negligent or even intentional their action was to
violate any other law that may conflict with this, they would be
granted blanket immunity," he noted. "It just doesn't appear
anywhere in the code like that. And they've got all kinds of
mandates in the code that they have to follow."
Number 0370
REPRESENTATIVE ELTON said he had a couple of problems with the
amendment. First was the assumption that life, disability and
health insurance were the only insurance lines that needed
addressed. He noted there was information in his packet compiled
by the Women's Law Project in Philadelphia, which indicated
shelters in Vermont were having a tough time getting insurance due
to rejections and high rates because of domestic violence. A
homeowner's policy in Washington state had been cancelled by Safeco
after receiving information about domestic violence-related claims.
Also in Washington, a landlord's policy was cancelled because the
insurer learned the landlord intended to rent to a women's shelter.
"I think there are examples out there. And for us to say the only
applicable lines of insurance are life, disability and health
insurance is misleading and addresses only a portion of the
problem," Representative Elton stated, adding that he had not even
addressed sections (b) and (c) of the amendment.
Number 0554
REPRESENTATIVE ELTON referred to comments by Representative
Rokeberg, sponsor of the amendment, that indicated the amendment
deleted subsection (b). "I don't see where that happens," he said.
REPRESENTATIVE ROKEBERG replied, "Technically, this is supposed to
delete Section 1 and replace it." He apologized for the confusion
and said, "If it's the will of the committee, I wouldn't look at it
as hostile to add property insurance into that. I don't think
that's the intent here, to exclude that."
Number 0512
REPRESENTATIVE ELTON asked if Representative Rokeberg would object
to removing the delineation and just saying "offering insurance".
REPRESENTATIVE ROKEBERG indicated he would not object to that, if
it would be the proper wording to cover all insurance. "We don't
want to have any discrimination," he said. "I don't disagree with
that."
REPRESENTATIVE PORTER asked if the committee had done that or just
talked about it.
CHAIRMAN KOTT clarified they had just talked about it.
Number 0554
REPRESENTATIVE ELTON moved to delete "life, disability or health"
from the amendment.
REPRESENTATIVE ROKEBERG interjected, objecting for discussion. He
asked Mr. Lessmeier, attorney for State Farm, if he wanted to
comment.
REPRESENTATIVE ELTON said he wanted to know the difference between
domestic abuse and domestic violence, since the amendment talked
about domestic abuse.
Number 0600
MR. LESSMEIER claimed there was not, to his knowledge, a single
example of a problem in property/casualty. "Our desire was to
limit the protection to where discrimination occurs," he said,
"which is in insurance over the person." He responded to instances
cited by Representative Elton and said the first two dealt with
life insurance and the third was cancelled because of multiple
fires set in the home. He said problems in Vermont with women's
shelters raised a concern of commercial insurance. And the
Washington state policy was denied because of multiple claims. He
asserted there were no "valid" situations in the property and
casualty business of discrimination based on status as a victim of
domestic violence.
CHAIRMAN KOTT noted there was a call to attend a House floor
session. He said SB 197 would be heard first at the next meeting.
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