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Regulatory News

CALIFORNIA
Two surplus lines bills have been sent to Gov. Schwarzenegger for signature. Assembly Bill 1708 increases minimum capital and surplus requirement for surplus lines companies from $15 million to $45 million. Part of the capital ($25 million) would be held in forms meeting Department of Insurance statutory requirements for general investments. The balance would be held in financial instruments allowable under the general investments law or the excess funds investments law. Special minimums are set for surplus lines carriers that are on the DOI’s LESLI list and don’t meet the capital and surplus lines requirements imposed by A.B. 1708. They must have at least $30 million of capital and surplus as of Dec. 31, 2011, and at least $45 million of capital and surplus by Dec. 31, 2013. The bill provides a staged transition to the new requirements. It passed unanimously in the Senate and Assembly. >> A.B. 1837 is the second surplus lines bill passed unanimously and sent to the governor. It permits a California domestic insurer to provide certain admin services to an affiliated, non-admitted insurer that’s been approved by the DOI to accept surplus lines placements. >> In the so-called Guzman case, the 6th Appellate District of California’s Court of Appeals rules that physicians can apply clinical judgment to determine the percentage of permanent disability in cases of injured employees and that American Medical Assn. guidelines are not absolute. >> Commissioner Steve Poizner is seeking nearly $30 million this year in grants from the state to local district attorneys for finding and prosecuting workers comp fraud. Approval hinges on the state’s final budget. >> The WC Rating Bureau has submitted a pure premium rate filing to the insurance commissioner recommending a 29.6% increase effective Jan. 1. >> Employers must now distribute the updated workers compensation new-hire pamphlet to all employees hired on or after Oct. 8. They must also post the revised WC employee posting notices, provide updated Notice of Potential Eligibility to injured workers, and post new medical provider network notices if they use such a network. Both insured and self-insured employers are subject to the posting notice and pamphlet requirements.
www.insurance.ca.gov

CONNECTICUT
Insurers and all licensees of the Insurance Department must notify the insurance commissioner in writing via first class mail, overnight delivery or email of any breach of information that affects any Connecticut resident as soon as the incident is identified but no later than five calendar days after an occurrence is identified. See Bulletin IC-25.
www.ct.gov/cid/site

FLORIDA
The Office of Insurance Regulation is calling for data from insurance companies to learn more about the epidemic of sinkhole claims. Pasco and Hernando Counties, both north of Tampa, account for over 80% of sinkhole claims in the state, but insurers are seeing an increase across the board. The data sought will help the state put concrete numbers behind the assertions.
www.floir.com

INDIANA
Insurance Commissioner Carol Cutter died Sept. 6. Gov. Mitchell Daniels Jr. appointed Cutter to the in June 2009. She succeeded Jim Atterholt, who left for the Indiana Utility Regulatory Commission. Stephen Robertson has been acting commissioner since she took medical leave in June.

IOWA
Insurers assessed $4 million to cover shortfall in state-run Second Injury Fund. Payments were due Sept. 30. >> National Council on Compensation Insurance has asked for an average increase of 4.7% in voluntary rates and an average 9.1% hike in assigned risk rates, effective Jan. 1 for new and renewal policies.
www.iid.state.ia.us

LOUISIANA
Scott Kipper chosen as deputy commissioner for the Office of Health in the Department of Insurance. He will oversee all lines of health insurance, supplemental products and the Senior Health Insurance Information Program. He held this position from 2005 to 2007. Most recently, he was Nevada’s commissioner of insurance.
www.ldi.state.la.us

MASSACHUSETTS
State Appeals Court rules in Casco Bay Finance Co. v. Quincy Mutual Fire Insurance Co. that the mortgagee cannot recoup rent lost on a foreclosed, fire-damaged apartment building under the mortgagor’s business owners policy. The court said that the coverage is limited to actual loss of business income sustained by the policyholder due to a necessary suspension of his operations and is not for the benefit of the mortgagee.
www.mass.gov

MISSOURI
Gov. Jay Nixon signs S.B. 583, giving the Department of Insurance, Financial Institutions and Professional Regulation authority to move in earlier, before an insurer is insolvent, to promote rehabilitation over liquidation. Provisions in the law are based on NAIC standards for deciding when an insurer is in hazardous financial condition.
www.insurance.mo.gov

MONTANA
Legislators in January will undertake reform bill that includes reductions for employer percentages of worker wages for workers compensation insurance from the current 4% or more to the national average of about 2%. The reforms would overhaul the entire way doctors do WC business and would limit the role of lawyers in disputes. It passed out of committee by unanimous vote. Doctors and lawyers are ticked.
sao.mt.gov

NEBRASKA
Ann Frohman, state insurance director, has resigned effective Oct. 29 to pursue a career in the private sector. She has worked for the state for 22 years and has been insurance director since 2007.
www.doi.ne.gov/

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