Credit, Privacy Top Agenda for 2003 Mont. Legislature

February 10, 2003

The Montana legislature will consider several insurance-related bills this session, covering topics including use of credit, prompt claims payment, stacking of motor vehicle liability coverages, consumer privacy, producer licensing, workers’ compensation benefits and access to court records.

“With more than 800 bills introduced, and more than 2,000 pre-filed, the Montana legislature has its work cut out,” said Donald S. Cleasby, assistant vice president and assistant general counsel of the National Association of Independent Insurers (NAII). “The insurance industry faces several crucial bills in this session, especially those concerning use of credit and privacy developed by the Montana Department of Insurance.”

NAII is actively involved in the following bills:

Credit–HB 184 imposes numerous restrictions on insurer’s use of credit information in rating and underwriting of homeowners and automobile insurance. The bill has been the subject of several subcommittee meetings since it was heard in Committee on Jan. 23. Although the bill came out of the subcommittee on a 14 to 4 vote with a few favorable amendments, the industry still opposes it. “NAII will work to defeat this bill on the House floor, and will join a larger industry effort to support a Senate alternative more closely aligned with the NCOIL model,” Cleasby said.

Privacy–HB 205, the privacy bill designed to comply with the federal health information privacy law (HIPAA), was the subject of a hearing last week. NAII objected to some of its provisions, including the need for exemption for entities that comply with HIPAA privacy standards, clarification of notice requirements, and elimination of some disclosure requirements.

Claims–HB 130, which requires property/casualty insurers to make claims payments within 60 days, passed the House last month by an 88 to 11 vote. It now is in the Senate Business and Labor Committee. Under the bill’s provisions, insurers are relieved from the 60-day requirement if they suspect insurance fraud and report it to the Commissioner. In addition, a $1,000 cap on the administrative penalty that may be imposed for a violation of the statute is removed. Workers’ compensation and professional liability insurers were excluded from these provisions. “The NAII will work strenuously to defeat this bill in the Senate,” Cleasby said.

Stacking–HB 463 seeks to repeal an existing Montana statute that eliminates stacking of coverages for motor vehicle liability policy limits, regardless of the number of motor vehicles insured under the policy, the number of policies issued by the same company covering the insured, or the number of separate premiums paid. NAII raised the issue that states that allow stacking have UM/UIM claims costs that are 45 percent higher than UM/UIM claims costs in states that do not allow stacking. “Montana consumers already have options to purchase higher coverage limits,” Cleasby said. “This bill essentially forces higher limits upon them, whether they want it or not or whether they can afford it or not.”

Producer licensing–HB 169 passed the House last month by a 63 to 36 vote. It is scheduled for hearing in the Senate Business and Labor Committee on Feb. 18. The independent agents association in Montana still harbors concerns with background check requirements found in the bill.

Workers’ Compensation–

HB 164 removes caps for payments for permanent total disability benefits. This bill passed the House last month by an 83 to 16 vote. It is scheduled for a Feb. 12 hearing before the Senate Business and Labor Committee.

HB 296 expands attorneys’ fees that may be awarded for denial of medical benefits later found compensable. This bill passed the House on Feb. 1 by a 63 to 33 vote. It has been referred to the Senate Business and Labor Committee where a hearing date is not yet scheduled.

HB 410 states that an employee who suffers an injury or dies while travelling is covered under workers’ compensation if the employer furnishes the transportation or the employee receives actual reimbursement from the employer for the costs of travel. This bill passed out of the House Business and Labor Committee on Jan. 30.

SB 282 requires that temporary total disability benefits be paid for the lesser of either the first 40 hours or five days’ loss of wages if a claimant is totally disabled and unable to work for six or more days because of a workplace injury. The existing statute states that the employee may not be paid for the first 40 hours or five days’ loss of wages. This bill is scheduled for hearing before the Senate Business and Labor Committee on Feb. 12.

SB 304 calls for a study on the feasibility of privatizing the Montana State Fund, the market of last resort for workers’ compensation. The bill will be heard in the Senate Business and Labor Committee on Feb. 13.

SB 324 repeals a limitation on temporary total disability benefits that allows those benefits to be terminated on the date that the worker has been released to return to work in some capacity. This bill has been referred to the Senate Business and Labor Committee. A hearing is not yet scheduled.

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