A bill changing the way insurers are assessed payments to the state’s second injury fund passed the Michigan House Feb. 14. The American Insurance Association (AIA), a strong supporter of the measure, anticipates the bill will soon be on the desk of Gov. John Engler.
The bill, SB 718, passed the state Senate late last year. It was introduced in response to a national accounting rule adopted in 1999, which requires that if a state assesses an insurer’s payments to the second injury fund based on losses, the insurer must recognize its all-time liability to the fund on its books. If the assessment is based on premiums, the liability need only be recognized for one year. SB 718 changes insurers’ assessments from paid losses to premiums thereby allowing companies to continue writing workers’ compensation coverage in Michigan.
“The current assessment system has significantly reduced both the statutory capital of Michigan insurers and the amount of business they can write in the state,” said Deirdre K. Manna, AIA assistant vice president, Midwest region. “AIA is pleased that both houses of the Michigan legislature have passed this much-needed reform, and we will continue to work for its enactment.”
The bill is neutral for state revenue purposes and would result in no reduction of benefits to injured Michigan workers.
Banks Still Face Legal Claims After $25 Billion Settlement
MF Global Judge to Examine Insurance Payments for Former Executives
Daredevil CEOs May Put Companies at Risk
California Independent Contractor Law May Be Liability for Agents, Brokers
North Carolina Continues Auto Regulation Debate As Rates Stay Same for 2012
Long-time California Lobbyist Looks to 2012 Legislation Affecting Insurance
Mine Safety Chief Seeks to End Complacency Over Safety
Virginia Court Grants Rehearing of Global Warming Claims Case
