LEG REG REVIEW is a periodic newsletter produced by PHILLIPS ASSOCIATES, a professional lobbying and consultant firm located near the State Capitol. It contains news on the legislative and regulatory scene in Pennsylvania that may be of interest to the Insurance and Business Communities. It is a free member benefit for those who are members of the Pennsylvania Association of Health Underwriters (PAHU) or Manufacturers Association of South Central PA (MASCPA). Subscription information may be obtained by contacting PHILLIPS ASSOCIATES at 717/728-1217 FAX 717/728-1164 or e-mail to email@example.com. Please email firstname.lastname@example.org supplying both your name and e-mail address if you wish to be removed from this list.
FAIR SHARE ACT DOMINATES INSURANCE, BUSINESS AGENDA
On June 21, the PA Senate sent Senate Bill 1131 on to the House, which, if it concurs, paves the way for a Corbett signing. The legislation had been amended in the Senate Judiciary Committee to expand exemptions to comparative negligence. This amendment was regarded by business and insurance advocates as a major watering down of the bill so Senator Jake Corman (R-Centre) proposed an amendment which was adopted 28-22 by the full Senate restoring the original language (Senator Dinniman was the only Democrat to vote for the Corman amendment.). The original language provides exemptions for liquor liability and toxic substances. Otherwise, SB 1131 replaces the doctrine of joint and several liability where any party could be potentially liable for 100% of a jury award to a standard of comparative negligence which allows for proportional payment based on the degree of responsibility. House consideration is certain this coming week. The final Senate vote was 32-18 and included three Democrats, Senators Boscola (Northampton), Dinniman (Chester), and Schwank (Berks). Two Republicans broke ranks to vote no in the Senate, Senators Greenleaf (Montgomery) and Yaw (Lycoming.
Over 100 business groups led by the PA Chamber of Business & Industry sent a joint letter to House members expressing support for SB 1131. PAHU and MASCPA sent a separate letter to the House. Fathering the process, on June 23, the House Judiciary Committee voted for the bill and paved the way for a House vote on SB 1131 this week.
BILLS EN ROUTE TO GOVERNOR
- Surplus lines legislation went to the Governor on June 26. Senate Bills 1096 and 1097 (D. White-R-Indiana) breezed through the final step, a House vote, by 193-0. A last minute threat to amend the bill with a number of health insurance mandated benefits was blocked when backers withdrew the amendments.
SB 1096 and SB 1097 bring PA into July compliance with the provision of last year’s federal Dodd-Frank Act dealing with Surplus & Excess insurance lines. The legislation resolves the question of how surplus lines premium taxes are paid. This has long an issue for surplus lines licensees who write an account covering several states and have to pay the premium tax to each state even though the basis of the taxation is inconsistent. The Non-Admitted and Reinsurance Act of 2010 was designed to reduce conflicts between states applying to a surplus lines insurance transaction which involves a business in more than one state. It says that the business’ home state provides the basis for taxation. It also stipulates that other states may not require a non-resident license for the surplus lines licensee in the business client’s home state.
- On June 24, the House approved House Bill 440 (Mustio-R-Allegheny) 195-0 which authorizes insurers including the State Workers Insurance Fund (SWIF) to provide on a voluntary basis Workers ’ Compensation insurance to sole proprietors, partners of a partnership or members of a limited liability company. It went to Governor Corbett for his signature June 26.
LOTS AND LOTS OF LEGISLATIVE ACTION
As the General Assembly gets ready to vote on a Budget and leave for its summer recess at the end of this week, the tempo of legislation has accelerated with these happenings:
- A bill classifying a Group One carcinogen as an occupational disease for firefighters governed by the Workers’ Compensation Act is ready for final House action after a June 26 vote by the House Appropriations Committee to move the bill. If approved, House Bill 797 (Farry-R-Bucks) will go to Governor Corbett for his signature. The legislation says that a four year or more firefighter who can establish direct exposure to a Group One carcinogen as recognized by the International Agency for Research on Cancer is covered by WC if he/she passed a physical exam showing no cancer before the exposure occurred. The time frame for filing Workers’ Compensation claims is 600 weeks after the last date of employment.
- Flood disclosure history must be provided to lessees of residential property per Senate Bill 148 sponsored by Senator Stewart Greenleaf (R-Montgomery). It passed the House Rules Committee June 26 per a report from PA Legislative Service. (NOTE: The General Assembly Electronic Bill Room does not show any activity on the bill since January 12 when it was referred to the Senate Urban Affairs & Housing Committee.)
- House-passed House Bill 424 (Godshall-R-Montgomery) is now in the Senate Banking & Insurance Committee. It amends the Public Adjuster Law to strengthen regulatory oversight and allows for consumers to rescind a contract with a public adjuster.
- Senate Bill 3 (D. White-R-Indiana) moved through the House Insurance Committee June 22. It prohibits PPACA’s Health Insurance Exchanges from covering abortions; something which opponents say is already covered by the Patient Protection Affordable Care Act (PPACA). The vote was 22-2 with one not voting. The two no votes were Representatives Josh Shapiro (Montgomery) and Matthew Smith (Allegheny).
- UC LAW UDATE: The Act number was unknown at the time of printing Leg Reg Review Issue 21 of 2011 (June 20) for the Unemployment Compensation bill signed into law by Governor Corbett June 17. Senate Bill 1030 is now Act 6 of 2011.
- The Senate confirmed Julia Hearthway as Secretary of Labor & Industry. She oversees the state’s Worker’s Compensation and Unemployment Compensation systems. Prior to her nomination by Governor Corbett, she led the Attorney General’s efforts to combat insurance fraud.
- May’s collections continue the upward trend of tax revenues exceeding estimates. Brought in was $1.8 billion which was $33.9 more than projected. The $539 million year to date “surplus” is the matter of Budget discord as Democrats in both House and Senate try to attach those monies to reduced or eliminated programs. Last week, some Democrats were projecting as much as $700 million that could be allocated by the General Assembly as “found money” to fund education or social services. Republicans maintain that the money should be used to replenish the Rainy Fund rather than be spent.
- Passing the Senate June 21 was Senate Bill 388 (Vance-R-Cumberland) amends the Dental Law providing for proof of professional liability insurance as a condition of licensure. SB 388 language calls for $1 million per occurrence, $3 million aggregate.
TRANSPORTATION COMMITTEES MOVE TWO DRIVER BILLS The House Transportation Committee moved Senate Bill 314 (Tomlinson-R-Bucks) affecting distracted [texting, hand-held devices] drivers on June 22 while the House Transportation Committee moved House Bill 9 (Watson-R-Bucks) to enhance the state’s Graduated Driver’s Licensing program for junior drivers. Both bills are ready for a vote by the House (SB 314) and Senate (HB 9) which, if they occur, virtually guarantee passage by the start of the summer recess.