Report Title:
HEMIC Workers' Compensation Insurance Surcharge
Description:
Authorizes HEMIC to impose limits on workers' compensation insurance premiums for HEMIC policies; requires HEMIC to explain surcharges.
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
2823 |
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TWENTY-FIRST LEGISLATURE, 2002 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
relating to workers' compensation insurance.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Section 431:14-101.5, Hawaii Revised Statutes, is amended by adding a new definition to be appropriately inserted and to read as follows:
""Surcharge" means an amount assessed by the Hawaii employers' mutual insurance company against a policyholder over and above the premium."
SECTION 2. Section 431:14-104, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) Every insurer shall file in triplicate with the commissioner, except as to specific inland marine risks which by general custom of the business are not written according to manual rate or rating plans and bail bonds subject to section 804-62, every manual of classifications, rules, and rates, every rating plan, and every other rating rule, surcharge, and every modification of any of the foregoing which it proposes to use. Every filing shall state its proposed effective date, and shall indicate the character and extent of the coverage contemplated. The filing also shall include a report on investment income."
SECTION 3. Section 431:14-110.5, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) All policies issued to employers for workers' compensation insurance shall disclose clearly to employers as separate figures the portion of the premium charged for:
(1) Medical care, services, and supplies;
(2) Wage loss benefits including temporary total, temporary partial, and permanent total disability benefits and their related benefits;
(3) Indemnity benefits for permanent partial disability; and
(4) Death benefits.
In addition, a disclosure statement shall indicate to the employer the portion of the premium attributable to loss control and administrative costs, attorney's fees of the insurer, the cost of employer requested medical examinations, and private investigation costs.
In the case of a surcharge imposition, a disclosure statement shall indicate to the employer the formula for the surcharge and an explanation, in easily understandable language, clearly describing the reason for the surcharge and how it was determined."
SECTION 4. Section 431:14A-110, Hawaii Revised Statutes, is amended to read as follows:
"[[]§431:14A-110[]] Premium rates, determination. (a) The board shall establish the premium rates to be charged for insurance sold by the company. The company shall comply with the requirements set forth in article 14 of this chapter. Premium rates shall be set at levels sufficient, when invested, to carry all claims to maturity, to meet the reasonable expenses for administering the company, and to maintain a reasonable surplus.
(b) The board shall hire a qualified actuary to assist with the development of sound premium rates.
(c) Notwithstanding any law to the contrary, the board may establish maximum limits on the premium rates to be charged for insurance sold by the company; provided that the board shall provide an opportunity for a public hearing at the earliest practicable time before the proposed premium limits are effective. The public hearing shall be conducted and notice given in an adequate manner to apprise all interested persons of the proposed premium limits and allow an opportunity for all interested persons to submit data, views, or arguments, orally or in writing. The board shall satisfy any requirement for holding a public hearing under this section if adequate notice of the opportunity for the public hearing on the proposed premium limits is given to interested persons and no written requests for the hearing are received by the board within a reasonable time."
SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 6. This Act shall take effect upon its approval.
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INTRODUCED BY: |
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