According to the National Association of Independent Insurers (NAII), at the urging of the association and its member companies, the Colorado Division of Insurance agreed to withdraw two bulletins that rendered meaningless the word “solely” in Colorado insurance statutes and exceeded state law by prohibiting the use of certain underwriting and rating factors.
In attempting to clarify the meaning of the word “solely” in Bulletin 05-01, the Division effectively prohibited the use of such factors as age sex and residence as rating factors. Bulletin 04-01 essentially ignored the word “solely” in both Colorado law and regulation and prohibited the use of prior motor vehicle insurance liability limits as an underwriting, rating or tier placement factor.
In a June 5 letter to Allstate Insurance Co., Colorado Insurance Commissioner William Kirvin explained that Bulletins 04-01 and 05-01 were being withdrawn due to legitimate concerns expressed by the insurance industry. Kirvin agreed that the substance of the bulletins exceeded existing Colorado law and that the bulletins were improperly issued.
Michael Harrold, Northwest regional manager for the NAII expressed the association’s satisfaction with the Commissioner’s apparent agreement that issuing bulletins without following the administrative procedures act is improper, and that future bulletins would be given more stringent internal review and legal scrutiny before issuance.
On the other hand, Harrold said the NAII remains concerned that concerned that the Commissioner might in the future interpret the word ‘solely’ as used in certain Colorado statutes in a restrictive manner.
Insurers were also concerned about the DOI’s recent promulgation o privacy regulations that exceed the federal requirements set out in the Gramm-Leach-Bliley (GLB) Act by including workers’ compensation and third-party claimants.
The DOI disregarded the industry request to remove workers’ comp and third-party claimants from the scope of the regulation. However, it did follow one insurance industry recommendation by making it clear that incorporating the HIPAA rules in no way changes the obligations of a licensee that is otherwise complying with the Colorado regulation and is exempt from the U.S. Department of Health and Human Services (HHS) regulation.
The regulation’s effective date is July 1, 2001, but the DOI will not enforce the provisions until October 2001.
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