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- LEG REG REVIEW
- 2003,
Thirty-Sixth Issue
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- LEG REG REVIEW
is a periodic newsletter produced by PHILLIPS ASSOCIATES, a
professional lobbying and consultant firm based near the State
Capitol. It contains news
on the Legislative and Regulatory scene in Pennsylvania that may be of
use to insurance producers, companies, and interested parties.
PSLA and PAHU members are receiving this as a Member Benefit.
Subscription information may be obtained by contacting PHILLIPS
ASSOCIATES at 717/728-1217, Fax 717/728-1164 or E-mail to xenobun@aol.com.
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- HAPPY NEW YEAR
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- This is the
last edition of the Leg-Reg Review for 2003. PHILLIPS ASSOCIATES hopes that you found it to be a useful
resource in keeping you up to speed on events happening in Harrisburg
and, to some extent, Washington.
As always, please give us your feedback.
(On a technical level, we regard you as having an established
business relationship with us in terms of you being on this fax
distribution list. We will of course honor your request if you let us
know that you no longer wish to receive this newsletter.)
Best wishes for the New Year!
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- GENERAL ASSEMBLY (FINALLY) ENDS FOR THE YEAR
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- The PA
General Assembly concluded its business December 21 for the Senate and
December 23 for the House. On
December 24, you should have received a summary of the budget-related
legislation to finally pass the House sent to you by PHILLIPS
ASSOCIATES. Of particular
interest should be the section containing fee increases as they relate
to insurance (surplus lines, etc.) and securities.
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- Other
late-session insurance activity that was overshadowed by the larger
budget debate:
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- ·
Passage
of re-authorization of HIPAA health insurance rules in PA (Act 50,
Senate Bill 483). If this
had not passed, HHS could have seized regulatory control of the small
group and individual health insurance market away from the PA
Insurance Department. The
bill also dealt with disclosure to the insured of a company-owned life
insurance policy.
- ·
HR
355, a resolution asking that Governor Rendell offer long-term care
insurance as an optional benefit for state employees, was pulled from
the agenda of the House Health and Human Services Committee after a
Republican member attacked the proposal.
He felt that the General Assembly should not intrude into
collective bargaining negotiations between Governor and state worker
unions. He also felt that
an optional benefit would become the new floor for labor demands in
collective bargaining. The
Chairman pulled the bill rather than risk an unfavorable vote.
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- CROP INSURANCE SIGN-UP BEGINS DECEMBER 31
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- Sign-up for
the 2004 AGR and AGR-Lite Crop Insurance program created by the PA
Department of Agriculture begins December 31, 2003 and ends January
31, 2004. This new
program gives farmers a supplement (or alternative) to traditional
multi-peril Crop Insurance in that it is measured by income loss
rather than by yield loss. In
addition, many additional crops (vegetables, nursery stock, dairy
cattle, etc.) are covered. This
program coupled with significant premium assistance from USDA and the
Commonwealth to result in a dramatic increase in the numbers of
policies sold by independent agents.
Current policy count for all Crop Insurance is estimated to be
about 16,000. Details:
Gene Gantz (Risk Management Agency) 717/787-4694.
- PRODUCER LICENSING BILL TO BE INTRODUCED
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- Republican
Dave Hickernell (Lancaster) is circulating a memo to other legislators
asking that they co-sponsor a bill to give new licensees the ability
to sell insurance immediately while their background is being
reviewed. The argument is that lengthy FBI delays in checking
backgrounds result in some individuals being held in limbo for more
than a month. This would
impede the ability to attract qualified individuals to the insurance
industry because they would have to wait a long time before actually
earning money. The hiring
agency, in its turn, would not be able to carry the individual for an
extended period without him or her bringing in new business.
The Pennsylvania Association of Health Underwriters is
particularly interested in the proposal.
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- TWO INSURANCE REGULATIONS APPROVED
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- The
Independent Regulatory Review Commission (IRRC) gave its final
approval to two regulations sought by the Insurance Department as
published in the December 27 PA Bulletin.
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- The first
is a regulation recognizing the 2001 CSO Mortality Table for use in
Determining Minimum Reserve Levels & Nonforfeiture Benefits.
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- The second
increases fees for the Underground Storage Tank and Indemnification
Fund (USTIF) because of a September actuarial study that warned USTIF
that its reserves were at risk of being insufficient unless fees were
adjusted upward. The new
fee for petroleum is .011 cent per gallon.
This translates into increases of about 8 cents per month per
motorist and $15.54 per quarter for municipalities.
The fees are meant to sustain claims coming from spills
involving underground storage tanks.
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- Other
non-regulatory insurance related developments include:
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An
application from Franklin Homeowners Assurance Co. to increase its
approved classes of underwriting authorities.
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A
loss cost filing from the Coal Mine Compensation Rating Bureau of 9.6%
with an employer assessment factor to be 4.44% (down from the current
5.41%).
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Publishing
of a list of 62 qualified unlicensed reinsurers (PA Bulletin 12/26/03)
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Department
disapproval of a rate filing for individual health and Medicare
Supplement sought by Independence Blue Cross, NE Blue Cross, Capital
Blue Cross, and Highmark. The
Department’s rationale according to their December 26 announcement
was that the Blues “did not adequately show how the surplus is being
used to subsidize these individual filings.
We are unable to determine if the proposed rate increases are
excessive, inadequate, or unfairly discriminatory.”
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- UPCOMING…
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- ·
The
House Health & Human Services and the Aging and Older Adult
Committees are convening a joint hearing on quality and safety in
long-term care facilities January 7 in Philadelphia. The hearing was
sparked by a Germantown nursing home that could not find a resident
who happened to be the mother of a state representative from
Philadelphia.
- ·
In
South Central PA, the Bagel
Bunch is starting its second year as an informal way to get CE
from 8:00 a.m. to 8:50 once or twice a month in Harrisburg and in
Lemoyne on the West Shore. Subscription is by agency so employees may choose which
classes are best for them and still be to work on time. Topics include both P/C and L/A/H (Credit Scoring, E&O,
Group Health Market, Fraud, Life Issues, etc.).
Please call 717/732-7255 for a schedule and subscription
information. First class
is January 13.
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