Individual State Agency Fiscal Note — 5879 SB, Insurance Use of Credit Info, Office of Insurance Commissioner
Summary
Office of Insurance Commissioner fiscal note on a bill titled Insurance use of credit info. It states that the bill requires an insurer that uses credit information, on written request, to provide reasonable exceptions to the insurer's rates, rating classifications, company or tier placement or underwriting rules or guidelines for a consumer whose credit information was directly influenced by extraordinary life circumstances. Estimated operating expenditures from the Insurance Commissioners Regulatory Account-State are 0 in FY 2022 and 164,486 in FY 2023, with 1.1 FTE staff years in FY 2023. The note states that the Office of Insurance Commissioner (OIC) assumes complex rulemaking will be required in FY2023.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Cite this document
“Individual State Agency Fiscal Note — 5879 SB, Insurance Use of Credit Info, Office of Insurance Commissioner.”
Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2022-01-20-a29484-d238034-5879-fn-final-01-18-22-3dc2f4e15a/
, SHA-256 5b27e16c54f4a06f2c4b83efcc9f3ea75fe4b781e9c9f25a8d97100b6e0b180c.Full text
Individual State Agency Fiscal Note
Bill Number: 5879 SB Title: Insurance use of credit info Agency: 160-Office of Insurance
Commissioner
Part I: Estimates
No Fiscal Impact
Estimated Cash Receipts to:
NONE
Estimated Operating Expenditures from:
FY 2022 FY 2023 2021-23 2023-25 2025-27
FTE Staff Years 0.0 1.1 0.6 0.2 0.2
Account
Insurance Commissioners Regulatory 0 164,486 164,486 47,202 47,202
Account-State 138-1
Total $ 0 164,486 164,486 47,202 47,202
Estimated Capital Budget Impact:
NONE
The cash receipts and expenditure estimates on this page represent the most likely fiscal impact . Factors impacting the precision of these estimates ,
and alternate ranges (if appropriate ), are explained in Part II.
Check applicable boxes and follow corresponding instructions:
If fiscal impact is greater than $50 ,000 per fiscal year in the current biennium or in subsequent biennia , complete entire fiscal note
X
form Parts I-V.
If fiscal impact is less than $50,000 per fiscal year in the current biennium or in subsequent biennia , complete this page only (Part I).
Capital budget impact, complete Part IV.
X Requires new rule making, complete Part V.
Legislative Contact: Kellee Gunn Phone: 786-7429 Date: 01/16/2022
Agency Preparation: Michael Walker Phone: 360-725-7036 Date: 01/17/2022
Agency Approval: Mark Dietzler Phone: 360-725-7106 Date: 01/17/2022
OFM Review: Jason Brown Phone: (360) 742-7277 Date: 01/18/2022
Form FN (Rev 1/00) 172,056.00 Request # 22-31-1
FNS063 Individual State Agency Fiscal Note 1 Bill # 5879 SB
Part II: Narrative Explanation
II. A - Brief Description Of What The Measure Does That Has Fiscal Impact
Briefly describe by section number , the significant provisions of the bill , and any related workload or policy assumptions , that have revenue or
expenditure impact on the responding agency .
Section 1(7)(a) and 2(5)(a) require an insurer that uses credit information, upon written request from an applicant for
insurance coverage or an insured, to provide reasonable exceptions to the insurer’s rates, rating classifications, company or
tier placement or underwriting rules or guidelines for a consumer who has experienced and whose credit information has
been directly influenced by extraordinary life circumstances.
Sections 1(7)(d) and 2(5)(d) requires insurers to provide notice to consumers that reasonable exceptions are available and
information about how the consumer may inquire further.
Section 1(8) and 2(6) authorize the Office of Insurance Commissioner to adopt rules.
II. B - Cash receipts Impact
Briefly describe and quantify the cash receipts impact of the legislation on the responding agency , identifying the cash receipts provisions by section number
and when appropriate the detail of the revenue sources . Briefly describe the factual basis of the assumptions and the method by which the cash receipts
impact is derived. Explain how workload assumptions translate into estimates . Distinguish between one time and ongoing functions .
II. C - Expenditures
Briefly describe the agency expenditures necessary to implement this legislation (or savings resulting from this legislation ), identifying by section number the
provisions of the legislation that result in the expenditures (or savings ). Briefly describe the factual basis of the assumptions and the method by which the
expenditure impact is derived . Explain how workload assumptions translate into cost estimates . Distinguish between one time and ongoing functions .
Section 1(7)(a) and 2(5)(a) require an insurer that uses credit information, upon written request from an applicant for
insurance coverage or an insured, to provide reasonable exceptions to the insurer’s rates, rating classifications, company or
tier placement or underwriting rules or guidelines for a consumer who has experienced and whose credit information has
been directly influenced by extraordinary life circumstances. The burden is on consumers to request the premium relief and
provide documentation to demonstrate the life event had direct and meaningful impact on their credit information. The
request for premium relief may or may not be accepted by the insurer. If consumers do not receive the results they want, it
is anticipated they will file a complaint with the Office of Insurance Commissioner (OIC). Electronic complaints take an
average of 2 hours and phone complaints take an average of 10 minutes to resolve. The OIC assumes there will be an
additional 56 electronic and 128 phone complaint cases filed each year requiring a total of 133 hours (56 electronic cases x
2 hours + 128 phone cases x 10 minutes) of a Functional Program Analyst 3 (FPA3) (100 hours) and Functional Program
Analyst 4 (FPA4) (33 hours) each year beginning in FY2023.
Sections 1(7)(d) and 2(5)(d) requires insurers to provide notice to consumers that reasonable exceptions are available and
information about how the consumer may inquire further. The OIC expects that this notice will necessitate some type of
form filing, such as a standardized consumer notice so that one notice could be used across all affected lines of an insurer’s
business. The OIC assumes a one-time filing influx by 420 companies that will require 20 minutes each to review requiring
a total of 140 hours of a FPA3 (93 hours) and FPA4 (47 hours) in FY2023. OIC additionally anticipates 3 enforcement
cases a year to address whether the notice was provided to the consumer. Investigations generally take anywhere between
25-80 hours per case and enforcement actions require the equivalent of approximately 25 hours per case. For purposes of
this fiscal note, it is assumed that investigations will require an average of 25 hours per case and enforcement actions will
require an average of 25 hours per case requiring 75 hours of an Investigator 3 and 75 hours of an Insurance Enforcement
Specialist beginning in FY2023.
Section 1(8) and 2(6) authorize the Office of Insurance Commissioner (OIC) to adopt rules. Due to the fact that the
rulemaking would provide regulations around certain discretions allowed of the insurance company and undefined terms in
the bill language, ‘complex’ rulemaking will be required in FY2023. OIC assumes that it would hold a series of stakeholder
meetings, solicit feedback on multiple stakeholder rule drafts, and define a number of terms from the bill language into
administrative code.
Insurance use of credit info 160-Office of Insurance Commissioner
Form FN (Rev 1/00) 172,056.00 Request # 22-31-1
FNS063 Individual State Agency Fiscal Note 2 Bill # 5879 SB
Ongoing costs:
Salary, benefits and associated costs for .06 FTE Functional Program Analyst 3; .02 FTE Functional Program Analyst 4; .05
FTE Investigator 3; and .05 FTE Insurance Enforcement Specialist.
Part III: Expenditure Detail
III. A - Operating Budget Expenditures
Account Account Title Type FY 2022 FY 2023 2021-23 2023-25 2025-27
138-1 Insurance State 0 164,486 164,486 47,202 47,202
Commissioners
Regulatory Account
Total $ 0 164,486 164,486 47,202 47,202
III. B - Expenditures by Object Or Purpose
FY 2022 FY 2023 2021-23 2023-25 2025-27
FTE Staff Years 1.1 0.6 0.2 0.2
A-Salaries and Wages 99,100 99,100 27,896 27,896
B-Employee Benefits 32,489 32,489 9,866 9,866
C-Professional Service Contracts
E-Goods and Other Services 32,897 32,897 9,440 9,440
G-Travel
J-Capital Outlays
M-Inter Agency/Fund Transfers
N-Grants, Benefits & Client Services
P-Debt Service
S-Interagency Reimbursements
T-Intra-Agency Reimbursements
9-
Total $ 0 164,486 164,486 47,202 47,202
III. C - Operating FTE Detail: List FTEs by classification and corresponding annual compensation . Totals need to agree with total FTEs in
Part I and Part IIIA
Job Classification Salary FY 2022 FY 2023 2021-23 2023-25 2025-27
Functional Program Analyst 3 70,956 0.1 0.1 0.1 0.1
Functional Program Analyst 4 78,408 0.7 0.4 0.0 0.0
Insurance Enforcement Specialist 87,852 0.1 0.0 0.1 0.1
Investigator 3 74,604 0.1 0.0 0.1 0.1
Senior Policy Analyst 99,996 0.2 0.1
Total FTEs 1.1 0.6 0.2 0.2
III. D - Expenditures By Program (optional)
NONE
Part IV: Capital Budget Impact
IV. A - Capital Budget Expenditures
NONE
IV. B - Expenditures by Object Or Purpose
NONE
Insurance use of credit info 160-Office of Insurance Commissioner
Form FN (Rev 1/00) 172,056.00 Request # 22-31-1
FNS063 Individual State Agency Fiscal Note 3 Bill # 5879 SB
IV. C - Capital Budget Breakout
Identify acquisition and construction costs not reflected elsewhere on the fiscal note and describe potential financing methods
NONE
IV. D - Capital FTE Detail: List FTEs by classification and corresponding annual compensation . Totals need to agree with total FTEs in
Part IVB
NONE
Part V: New Rule Making Required
Identify provisions of the measure that require the agency to adopt new administrative rules or repeal/revise existing rules .
Section 1(8) and 2(6) authorize the Office of Insurance Commissioner (OIC) to adopt rules. Due to the fact that the
rulemaking would provide regulations around certain discretions allowed of the insurance company and undefined terms in the
bill language, ‘complex’ rulemaking will be required in FY2023. OIC assumes that it would hold a series of stakeholder
meetings, solicit feedback on multiple stakeholder rule drafts, and define a number of terms from the bill language into
administrative code.
Insurance use of credit info 160-Office of Insurance Commissioner
Form FN (Rev 1/00) 172,056.00 Request # 22-31-1
FNS063 Individual State Agency Fiscal Note 4 Bill # 5879 SB
File and source
- File
- 2022-01-20_a29484_d238034_5879-fn-final-01-18-22.pdf
- Size
- 117,766 bytes
- SHA-256
- 5b27e16c54f4a06f2c4b83efcc9f3ea75fe4b781e9c9f25a8d97100b6e0b180c
- Original
- No public link identified.