Insurance & Commerce - House and Senate

Glad to have everyone here today and a little bit about a lot of people out of town and and other meetings but we're glad to get started with this and I'd like to turn it over to my co chair to see if he has any opening comments. Hi good morning good to see everyone glad everyone made it back from the trip by and look forward to it efficient meetings one. Thank you Sir if we will get you started right or right all right along with this and we need to have a motion to approve the special expenses for the committee. I have a motion I have a second. All the all those in favor say aye. No the same sign. Is have if they are approved. We need to the approval of the minutes from the last meeting as well on October fifth twenty twenty two. Everyone has a copy that we have a motion to approve. And a second. All those in favor say aye. A post saying sign. Minutes are approved. Will move now to a the Mr rambut is going to come up general counsel with the insurance department now give us a brief overview of what's going on in the insurance commission. With both I know it's been slowing yells area lately so it shouldn't take very long. I'll try to go through thank you Mr chairman my name's booth rand they got my name come across state here but that's okay The commissioners away out of state at a meeting and I want to update joint insurance with some activities going on the insurance department been quite busy this summer I didn't really know what sort of items of interest might be issued the committee I thought I think I'll start off with the the March thirty first twenty twenty three twenty eight out in activities in the insurance market related claims we've had significant number residential property including auto and commercial property claims is up through the month of may of twenty twenty three in residential property claims reported we've had over nine thousand claims reported in residential property damages with total loss claims of about five of the how five hundred seventy three. The total paid losses by the insurance industry and state up through including may of twenty twenty three on residential property is a hundred ninety five million dollars and with sixty percent of the claims close so we've got a good ways to go got about forty percent left the claims to be adjudicated reviewed and so we're not finished yet obviously with residential property and commercial in the actual insurance market on the commercial property side we've had over nine hundred three claims reported through a tornado with total loss claims of forty two with the insurance market paid losses of approximately forty eight point five million with about forty percent of that market are being reviewed so we've got sixty percent last left of of claims to be reviewed in that market another interesting item is a personal auto took quite a significant hit from a tornado we've had over three thousand three or sixty claims out of those one thousand one hundred fifteen total loss claims with total paid losses of about twenty seven twenty seven million dollars with about sixty percent of the claims close so we've got about sixty percent of the market has reviewed and pay claims we've got about forty percent left so we've been hit pretty hard by the tornado and this is only tornado not the subsequent hailstorms I'm going looking at tornado data. in the insurance department all right related to tornado complaints we've got approximately six fifty six our complaints thirty of those are open and are being worked on by our investigators at this time so that is just some preliminary tornado information and be glad to afford any of you are data and law state if you're interested are moving on a little bit The five questions to stop you right there yes of the fifty six complaints that that you have what seems to be the main issue with those I think just arguing over total value is is a bin it been the issue and the and the in the end in explaining to consumers I depreciation allowances and those kinds of things. Good luck with that. wanted to do next move on to items that we have been requested by Senator Clark co chair here he's got this you'll find out later in the agenda and eyes P. to consider our evaluating Arkansas's minimum automobile liability limits and whether there's a need for increasing those as we all know cars have gone up in value Arkansas's current minimums are twenty five thousand C. twenty five thousand bodily injury per person fifty thousand bodily injury per accident and twenty five property damage per accident so and I don't think we've ever change to raise those ma'am and so Senator Hill All in co chair has asked us to provide some data to be all are related to his eyes peeled like to real quickly had some highlights on that we have submitted to be L. R. A. national survey of all the state minimums in Arkansas is is really right in line with other state minimums just looking at the construct contiguous states Louisiana is fifteen thirty twenty five Mississippi's twenty five fifty twenty five Arkansas Missouri is twenty five fifty twenty five Arkansas Tennessee is the same AS Arkansas twenty five fifty twenty five one of the concerns is if there is a decision to raise those in whatever fashion to maybe look at a fifty bodily injury per person one hundred bodily injury per accident and fifty are property damage per accident what sort of impact it might have on automobile premiums data six submitted to us we submitted B. O. R. Senator Hill indicate that are just speculating from the insurance side looks like it might increase premiums for percent to ten percent are with raises to fifty fifty fifty one hundred fifty. Other items Senator Bryant rants legislation this last session trying to improve Arkansas insurance department rule forty three that is our rule that governs claims in property and casualty there been some concerns that it's need to be updated modernize we have formed a working group with the insurance industry insurance agents and plants attorneys I'm involved it is Senator Bryant's involved in it we are trying to modernize rule forty three to improve property in cash payment practices one item in I think Senator hills ISP relates to matching we are considering adopting matching provisions which require homeowners carriers to match damage shingles in line of sight Arkansas does not have a matching provision and were we are submitting that to the working group for consideration and we'll update center hill and B. O. R. as to what we we have have have discussed in addition have sent to be are Ste other state laws were matching is required so that's going on Arkansas the insurance department send number of proceedings and litigation all now the insurance department is and trying to force a temporary hospital facility act Senator Irvin was involved in that are we are in a proceeding against blue cross blue shield S. to Ark Forsman of that against them to make sure that they maybe cover and treat our injuries surgical centers just like hospitals that is an ongoing proceeding briefs were submitted last week and we have a judge hearing officer that's going to decide that matter the other item insurance department is being sued in its enforcement act level three for many of you have constituent House Bills that rely. Part three forty B. discounts the insurance department sued by the pharmaceutical industry last year we prevailed in federal District Court which upheld the validity of the act and farmers appealed to the eighth circuit oral arguments are set for discussion in the fall and so we won't really get a ruling on the eighth circuit's decision about whether the act is valid or not until of the fall or winter of of this year of the insurance department is also trying to adopt and promulgate a rule of all this practices and procedures it will be a one rule that will govern and described the public exactly what we do all of our forms provide information related to insurance agents and producers right that need to know about procedures and processes of the department we are working on that at this time other rules that we've got it at that are under golf under going right now we are implementing a rule to effectuate the legislation on pandas P. A. N. D. S. I think Senator Hammer was involved in that and we've got some other burial insurance rules so that's a brief update be glad to answer any questions to the extent I can. Any questions from members are the those are just here to to oversee everything. Senator Hammer. Thank you Mr chairman thank you toucher over here to the far left with for the three of I'm sorry that's a could you will deeper as far as to the status of the battles with the PBMs of seeing some things at the national level and just things involving our local pharmacies can you just kind of gives a high level overview of where we are in a battle with them we have a. We've reached pretty stable compliance point on all the most of our compliance issues with PBMs I think yesterday we have a little bit of a pick up some of the pharmacists were concerned that the EBT PPM was not Our complying with Nate Act minimums and so they they fixed that yesterday so our PPM DVDs now compliance with state law so but in terms of other issue Senator Hammer we've pretty much reached a pretty stable enforcement position I don't have anything ongoing that I'm aware of it's a significant nature are otherwise I'm I would advise you were of that so we we don't we're we've got we've got a pretty good handle on right now. The number of Claims are the number of fines that have been levied and collected against PBMs top your head you know where we are on that I I think if you include last year we issued our year and a half a year ago we went on a and for spent our initiative and find all of the major PBMs roughly fifty to a hundred thousand dollars apiece um so you're looking at in the last year and a half three fifty to four hundred thousand dollars for. Collected collected K. R. thank you thank Mr Fletcher. Representative Maddox. Thank you Mister you didn't really touch on an almost hate to bring it up but would you mind giving an overview of the public school insurance issue our representative Max I was not involved in that I know the commission was and so I'm I'm I was not personally involved in that he is he is and eight he advised me that if I were to get a question on that advised community that he will be here next Tuesday at a LC to provide you with all the details information I'm not dodging I just don't want to give you any bad information. Okay thank you. Senator. Hey hope you're doing well personally thank you what you went through I hope everything's going well with you I have a question as it relates to are you seeing it as something not I have experience with my own insurance carrier on property and casualty with the recent hailstorm that hit Stone County are you seeing a push to to really these insurance companies are outsourcing the insurance part of adjusting and inspecting and and those kinds of things to the third party vendors and it's incredibly frustrating I mean I can just speak from a personal perspective I have four cars got damaged and they farmed amount to four different you know I have to know coordinate with four different subcontractors or whatever in order to arrange for them to come to my house and it just it yeah it's not mean if you're gonna be an insurance company be an insurance company not then let's move on to finance company I thank each companies will differ on that most of the national carriers will use independent adjusters if they don't have the staff and resources to put their own employee employee's adjusters in that state we we authorize that legally I'm not sure I'm sure it's frustrating to people to see that all third party adjusters are involved in adjudicating the claims but it it if if there is a national disaster that spans multiple states it taxes the resources of the insurance company nationally to put their own people all over the place they do use third parties so I don't know statistically how many you have done that Arkansas I know it is frustrating. You know USA a it's a pretty big and I think they have resources but and then the second thing that I wanted to ask was when it comes to the preferred vendors that they seem to be using you know To where they'll guarantee is that state law or federal law they cannot require proof for third as I understand our trade practices act they can not required for a third vendor are or do not claim over that so you're free to submit your own you know estimates as I understand it right but but they're saying that if you go to a preferred vendor it's then it's a guarantee that the work is guaranteed so that may be true but if you don't it's not guarantee they just can't do not claim over your failure to go to preferred vendors all I can say okay well I mean they're kind of trying to get around the law Pushin okay that that was just thank you for answering questions. Senator Hammer. You know of refresh my memory make sure I'm thinking straight but a couple sessions goes we fought pretty hard to get the Arkansas health insurance marketplace away from its independent status and parked over with you my right on that so far that's correct I think represent war laws got initiative now change that will serve on his eyes pay but that's correct okay so do you know how much we have saved because that was one of the initiatives or one of the efforts behind it was to eliminate the high salaries in the structure so we could move that savings over there and I thought I remember I we actually lowered the premium by doing that the fifty and and I don't know the statistics but I can ask Chantelle of our division to gauge that soon as I get back office if you don't mind like you a copy of what the savings have been since we moved it over there to you yes and we haven't lowered the feet any more than that was legislatively like put as far as the amount that we reduce the fee was that correct I think so and okay I'll get you that information all right thanks I think representive Wardlaw one cent for motion from Mrs well okay thank you thank you Mr. Representative first. Thank you Mr chairman of when you talk about real forty three in matching it it remind me of something that I've heard legislators in other states complain about a do we allow public adjusters in Arkansas we do not intended as a force by the Arkansas committee professional conduct Senate there's the restriction on public adjusting isn't from the insurance code it's from the Arkansas Supreme Court so okay thank you. Any other questions. Seeing none thank you Sir thank you serial. Moving right along to Adam else got the ISPs and that's we have an objection. The or someone to have a special hearing later on we'll pull one out other than that If we have a motion will will match all these together. Okay have a motion and a second all those in favor say aye. Those same signed. Without any objections will lotus batch all these together. So we'll start with I. S. P. zero zero two. All the way to. I S. P. zero eight eight. We have a have a motion to send the zone for ISP form for study. I have a motion and a second we have a second. The second all those in favor say aye. Proposing sign so we'll we'll move all those a different ISP to be completed. That being said us unless someone else has any other business. Representative Maddox would you like to thank you the next ten fifteen minutes force. I'll be glad to speak about anything that you want to hear That that no I think I don't think people want to hear that thank you. Appreciated everyone coming out today seeing no other business were returned.