HB 175-INSURANCE 3:17:26 PM CHAIR OLSON announced that the first order of business would be HOUSE BILL NO. 175, "An Act relating to insurance, including treating as confidential certain information submitted to the director of insurance by the National Association of Insurance Commissioners; clarifying conditions for the release of insurer deposits; defining travel insurance that may be sold under a travel insurance limited producer license; establishing criteria for licensing of nonresident independent adjusters as resident adjusters; exempting rewards under a wellness program from treatment as insurance discrimination or rebating; making certain insurance required of the Comprehensive Health Insurance Association permissive rather than mandatory; providing for the administration of loss reimbursement policies and payments to guaranty associations during insolvency proceedings; making certain provisions relating to statements on applications and guaranteed renewability for individual health insurance applicable to hospital and medical service corporations; making public certain forms and related documents filed for approval by a hospital or medical service corporation after the filing becomes effective; relating to deposits of self-funded multiple employer welfare arrangements; repealing reasons that the director of insurance may use to deny or revoke a license; and providing for an effective date." [Before the committee was the Version S.] 3:18:16 PM LINDA HALL, Director, Division of Insurance, Anchorage Office, Department of Community & Economic Development (DCCED), stated that the committee substitute Version S removes previous Sections 25 and 26 relating to insolvencies. She pointed out that Section 11 of the bill permits the Division of Insurance director to order a summary suspension of a license if the director finds that protection of the public requires emergency action and incorporates the finding in an order. She indicated that she asked for this authority in cases of extreme emergencies. She stated that is the only provision which represents a policy change. 3:19:47 PM REPRESENTATIVE COGHILL indicated that he spent some time with the director of the Division of Insurance and agrees that additional statutory authority is needed. He stated that he tried to imagine a different director and circumstances in which someone might misuse this authority. He offered his belief that enough safeguards are in the bill to prevent misuse of authority. 3:20:57 PM REPRESENTATIVE NEUMAN referred to the bill title and asked which information is confidential information. MS. HALL referred to Section 1 of Version S. She stated AS 21.06.060 lists records that must be kept confidential. She indicated AS 21.06.060(f)(2) adds to the list proprietary information or records established by a showing satisfactory to the director. Thus, the new paragraph would allow confidentiality for proprietary or trade secrets. Additionally, a change was made to paragraph (4) that would remove the term "financial" from the analysis rations and examinations. She explained that the division receives analysis ratios and examination synopses from the National Association Insurance Commissioners, which is other states' information. She mentioned the Division of Insurance has signed a confidentiality statement that it will not release other states' information. Thus, this change would allow the division to obtain market conduct information. REPRESENTATIVE NEUMAN asked what the insurance term is for a record check examining home insurance claims. 3:23:34 PM MS. HALL answered that Representative Neuman is referring to the [Comprehensive Loss Underwriting Exchange] C.L.U.E. report. She explained that would be considered personally identifiable consumer information. She offered her belief the division would not release to the public confidential consumer information that was collected in the course of conducting business. She related that those types of reports would generally be in the insurance company records and not in the division's records. 3:24:07 PM REPRESENTATIVE NEUMAN asked whether the consumer's identity is protected. MS. HALL answered that the division does not perform any profiling. She explained that the division would perform some rating underwriting through the use of credit scoring. However, the division does not receive detailed consumer information, which by statute is confidential. She related the division reviews standards. She stated that the rating and underwriting laws prohibit unfair discrimination. 3:25:07 PM MS. HALL, in response to Representative Neuman, explained that the Division of Insurance does not collect personal information so it would not have the ability to disseminate it. She added that under public records laws, the division does not have to collect and create reports that it does not already collect. She opined the division does not collect personal information. CHAIR OLSON offered his belief that the problem was corrected last year and pertained to a different department that had been releasing confidential information. 3:26:16 PM MS. HALL, in response to Representative Neuman, explained the only opposition received on HB 175 related to provisions that have been removed from the bill. 3:26:54 PM REPRESENTATIVE BUCH commented that the committee held extensive discussions on HB 175 a month ago and his concerns have been addressed. He inquired as to whether any other issues have arisen that would need to be addressed before next session. MS. HALL related her understanding that only three weeks remained of the legislative session. She answered she had no additional matters with respect to HB 175. 3:28:14 PM CHAIR OLSON, after first determining no one else wished to testify, closed public testimony on HB 175. REPRESENTATIVE NEUMAN moved to report the CS for HB 175, Version 26-LS0579\S, Bailey, 3/16/09, out of committee with individual recommendations and the accompanying fiscal note. There being no objection, the CSHB 175(L&C) was reported from the House Labor and Commerce Standing Committee. 3:29:23 PM The committee took an at-ease from 3:29 p.m. to 3:31 p.m.