The Colorado General Assembly has decided not to consider Pinnacol Assurance’s proposed plan to separate from the state, according to the company.
Earlier in March, the quasi-governmental workers’ compensation insurer had submitted a potential separation agreement to Colorado Gov. Bill Ritter that would establish Pinnacol as a domestic mutual insurance company owned by its policyholders in exchange for $330 million that could help ease the state’s budget crisis.
“We are disappointed that this proposal does not appear to be moving forward because we believe it would have benefited our policyholders, protected injured workers and brought stability to Colorado’s workers’ compensation market,” said Pinnacol’s President and CEO Ken Ross in a statement. “Of course, we will remain open to further discussions with our elected officials to attain these goals.”
In the meantime, Ross said he is still concerned with pending legislation being discussed.
- House Bill 1009 would change the makeup of the company’s board of directors, “disrupting the management of Pinnacol at a time when it has been highly successful at lowering rates, issuing dividends and ensuring the delivery of excellent customer service.”
- House Bill 1356 would cap Pinnacol’s surplus “at an arbitrary rate,” Ross said, threatening the company’s ability to remain solvent and “provide protection to policyholders and their injured workers.”
- House Bill 1012 would prohibit an insurer or employer from conducting surveillance of an employee who has submitted a workers’ compensation claim unless the insurer or employer has a reasonable basis to suspect that the employee has committed fraud or made a material misstatement concerning the claim. This would “impede the ability of all insurance companies to conduct legitimate investigations and scrutinize fraudulent claims, benefitting those who engage in fraudulent activities while increasing the costs of workers’ compensation insurance for everyone,” Ross said.
If the bills pass, Ross said they would “have a negative impact on Colorado’s business-friendly workers’ compensation market — a market that has helped make the state a place where businesses want to relocate or expand their operations, creating jobs for our citizens.”
Sources: Colorado Legislature, Pinnacol
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