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Senate Commerce Committee Statement to Senate, No. 2422 (May 16, 2022)

Summary

This is a Senate Commerce Committee statement to the New Jersey Senate on Senate Bill No. 2422, dated May 16, 2022. The committee reports the bill favorably. The bill updates the "New Jersey Life and Health Insurance Guaranty Association Act" to current standards from the National Association of Insurance Commissioners. Among the updates is an expansion of the assessment base to cover the insolvencies of long-term care insurers, so that all life and health insurers help cover them. The bill also sets a $500,000 cap on health insurance benefits issued by the guaranty association when an insurer is impaired or insolvent, with an adjustment tied to the health care costs component of the consumer price index from January 1, 2022.

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“Senate Commerce Committee Statement to Senate, No. 2422 (May 16, 2022).” Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2022-05-16-scm-s2422-s1-3081d74a23/, SHA-256 fb6ef96e19f0f739b75c9377792070c89a8ec1524cae36bbf32b7424d161749e.

Full text

     SENATE COMMERCE COMMITTEE

                    STATEMENT TO

                  SENATE, No. 2422

 STATE OF NEW JERSEY
                      DATED: MAY 16, 2022

    The Senate Commerce Committee reports favorably Senate Bill
No. 2422.
    This bill updates the “New Jersey Life and Health Insurance
Guaranty Association Act” to current standards from the National
Association of Insurance Commissioners.
    Among the updates in the bill is an expansion of the assessment
base that is to cover the insolvencies of long-term care insurers. All
life and health insurers will be required to assist in covering these
insolvencies. Currently, assessments are made against all health
insurance companies, even if the company does not sell long-term
care insurance, but only those life insurance companies that sell
long-term care insurance are assessed.
    Additionally, this bill sets the cap at $500,000 on health
insurance benefits issued by the guaranty association in cases of
insurer impairment or insolvency. This cap is proposed for
adjustment based upon changes in the health care costs component
of the consumer price index from January 1, 2022, to the date on
which the member insurer, as defined in the bill, becomes an
insolvent insurer.

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