ALASKA STATE LEGISLATURE  SENATE LABOR AND COMMERCE STANDING COMMITTEE  April 16, 2016 3:24 p.m. DRAFT  MEMBERS PRESENT Senator Mia Costello, Chair Senator Cathy Giessel, Vice Chair Senator Kevin Meyer Senator Gary Stevens MEMBERS ABSENT  Senator Johnny Ellis COMMITTEE CALENDAR    HOUSE BILL NO. 81 "An Act relating to an exemption from the regulation of construction contractors." - PENDING REFERRAL COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 372(L&C) AM "An Act relating to insurance; relating to the annual report by the director of policies and variable annuities; establishing limitations on issuance of long-term care insurance; relating to expenses for insurance examinations; relating to regulations for insurance; relating to requirements for group health insurance policies; amending the insurance utilization review, benefits determination, health care insurance grievance definition of 'group health insurance'; relating to motor vehicle service contracts; resolution procedures, independent review of adverse determinations or final adverse relating to notice requirements for meetings of stockholders or members of a domestic determinations, independent review organizations, and continuing education providers; insurer; establishing a definition of 'bona fide association'; relating to requirements and relating to required provisions for health care insurance contracts and policies, penalties for committing a fraudulent or criminal insurance act; updating criteria for including health care provider choice; establishing civil penalties for insurers for failure examinations; relating to rate filing deviations; establishing civil penalties for certain to provide requested records; amending the definition of 'wet marine and wilful violations; and providing for an effective date." transportation' insurance; amending provisions on limited licenses to include crop insurance; relating to third-party administrator notification requirements; relating to certification filing by reinsurance intermediary brokers; relating to rate filings, delivery of insurance policies or endorsements; relating to refunds of variable life insurance - MOVED SCS CSHB 372(L&C) OUT OF COMMITTEE PREVIOUS COMMITTEE ACTION  BILL: HB 372 SHORT TITLE: OMNIBUS INSURANCE SPONSOR(s): LABOR & COMMERCE 03/21/16 (H) READ THE FIRST TIME - REFERRALS 03/21/16 (H) L&C 03/28/16 (H) L&C AT 3:15 PM BARNES 124 03/28/16 (H) Heard & Held 03/28/16 (H) MINUTE (L&C) 03/30/16 (H) L&C AT 3:15 PM BARNES 124 03/30/16 (H) Heard & Held 03/30/16 (H) MINUTE (L&C) 04/04/16 (H) L&C AT 3:15 PM BARNES 124 04/04/16 (H) Heard & Held 04/04/16 (H) MINUTE (L&C) 04/06/16 (H) L&C AT 3:15 PM BARNES 124 04/06/16 (H) Moved CSHB 372(L&C) Out of Committee 04/06/16 (H) MINUTE (L&C) 04/07/16 (H) L&C RPT CS (L&C) 1DP 6NR 04/07/16 (H) DP: OLSON 04/07/16 (H) NR: LEDOUX, TILTON, HUGHES, KITO, JOSEPHSON, COLVER 04/13/16 (H) TRANSMITTED TO (S) 04/13/16 (H) VERSION: CSHB 372(L&C) AM 04/14/16 (S) READ THE FIRST TIME - REFERRALS 04/14/16 (S) L&C 04/14/16 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg) 04/14/16 (S) Heard & Held 04/14/16 (S) MINUTE (L&C) 04/15/16 (S) L&C AT 5:00 PM BELTZ 105 (TSBldg) 04/15/16 (S) Scheduled but Not Heard 04/16/16 (S) L&C AT 11:00 AM BELTZ 105 (TSBldg) WITNESS REGISTER LORI WING-HEIER, Director Division of Insurance Department of Commerce, Community and Economic Development Anchorage, Alaska POSITION STATEMENT: Continued the sectional analysis for HB 372 and answered related questions. SHELDON WINTERS, Retained Counsel State Farm Insurance Juneau, Alaska POSITION STATEMENT: Testified in opposition to Section 65 of version N for HB 372. WESTON EILER, Staff Senate Labor and Commerce Standing Committee and Senator Mia Costello POSITION STATEMENT: Reviewed the changes in the Senate CS for HB 372. KONRAD JACKSON, Staff Senator Kurt Olson Alaska State Legislature Juneau, Alaska POSITION STATEMENT: Testified the sponsor does not support Amendment 1 for HB 372. ACTION NARRATIVE    3:24:58 PM CHAIR MIA COSTELLO called the Senate Labor and Commerce Standing Committee meeting to order at 3:24 p.m. Present at the call to order were Senators Meyer, Stevens, and Chair Costello. Senator Giessel arrived soon thereafter. HB 372-OMNIBUS INSURANCE  3:25:31 PM CHAIR COSTELLO announced the consideration of CS FOR HOUSE BILL NO. 372(L&C) am; "An Act relating to insurance; relating to the annual report by the director of insurance; relating to expenses for insurance examinations; relating to regulations for insurance utilization review, benefits determination, health care insurance grievance resolution procedures, independent review of adverse determinations or final adverse determinations, independent review organizations, and continuing education providers; relating to required provisions for health care insurance contracts and policies, including health care provider choice; establishing civil penalties for insurers for failure to provide requested records; amending the definition of 'wet marine and transportation' insurance; amending provisions on limited licenses to include crop insurance; relating to third-party administrator notification requirements; relating to certification filing by reinsurance intermediary brokers; relating to rate filings, delivery of insurance policies or endorsements; relating to refunds of variable life insurance policies and variable annuities; establishing limitations on issuance of long-term care insurance; relating to requirements for group health insurance policies; amending the definition of 'group health insurance'; relating to motor vehicle service contracts; relating to notice requirements for meetings of stockholders or members of a domestic insurer; establishing a definition of 'bona fide association'; relating to requirements and penalties for committing a fraudulent or criminal insurance act; updating criteria for examinations; relating to rate filing deviations; establishing civil penalties for certain wilful violations; and providing for an effective date." She relayed the intention to continue the sectional analysis, take questions and public testimony, adopt a committee substitute (CS), and look to the will of the committee. 3:26:54 PM LORI WING-HEIER, Director, Division of Insurance, Department of Commerce, Community and Economic Development (DCCED), continued the sectional analysis for HB 372, starting with Section 60. Sec. 60 AS 21.69.310(c) Meetings of stockholders or  members  discretion to approve a date for an annual meeting later than the first six months of each calendar year upon a written request for approval for good cause. The request for approval must be made at least 30 days before the end of the six-month requirement. This amendment reflects the fact that annual meetings of Alaska insurers cannot always be held within the first six months of the calendar year due to the wide disbursement of board members and to the differing requirements for the timing of annual meetings of other states where holding companies with Alaska insurers are domiciled. Sec. 61 AS 21.69.390(b) Home office and records  21.69.390(d) as that subsection is being repealed for the reasons as stated in Sec. 67 of this Bill Analysis. Sec. 62 AS 21.85.500(5) Definitions  "multiple employer welfare arrangement" to conform with the meaning of the term as defined under 29 U.S.C. 1002. Sec. 63 AS 21.97.020 General penalty  more consistent with other penalty provisions in AS 21 such as AS 21.27.440 and to provide a mechanism to use under section four of the bill and for market conduct enforcement. This section has not been updated for over 30 years. Sec. 64 AS 21.97.900(47) Definitions for title