Colorado Panel to Examine Pinnacol Privatization Proposal

Article

A proposal to privatize the state-chartered workers’ compensation insurer, Pinnacol
Assurance, would give Colorado a $340 million ownership stake while restructuring it as a subsidiary of a mutual insurance holding company owned by policyholders.

Pinnacol said Thursday its proposal would provide the state an estimated $13.6 million in annual dividends to support education and business development and make Pinnacol a tax-paying entity.

Gov. John Hickenlooper has chosen 19 people representing businesses, insurers, workers and foundations to review the proposal and offer guidance on legislation to restructure Pinnacol.

“We want what’s best for injured workers, policyholders, the business community and the people of Colorado,” Hickenlooper said in a statement. “Done the right way, this proposal has the potential to benefit Colorado for generations to come.”

Pinnacol’s board is appointed by the governor, but it operates largely like a private insurer. It is required to cover employers that private insurers won’t.

Former Gov. Bill Ritter proposed last year selling Pinnacol but backed off, partly over concerns over the price.

Pinnacol has had a rocky relationship with the state after it was challenged last year over reports of lavish spending and excess profits, which lawmakers said the company racked up by denying claims from injured workers. The company has denied those allegations.

The members Hickenlooper appointed to the panel will meet during the next few months to analyze Pinnacol’s plan to privatize.