Alaska committee holds second hearing on omnibus insurance bill focused on accreditation, licensing and policy fixes

The House Labor and Commerce Committee held a second hearing on House Bill 148 on April 4, 2025, examining multiple technical and substantive changes to Alaska's insurance statutes, including updates to accreditation rules, licensing changes and several consumer-protection clarifications.

The bill contains multiple technical cleanups to Title 21 of the Alaska statutes and several provisions the Division of Insurance says are needed to maintain accreditation with the National Association of Insurance Commissioners (NAIC). "There are a few sections that are related to our accreditation," said Laurie Wing Hyer, director of the Division of Insurance. She said accreditation helps ensure that insurers examined in Alaska meet standards recognized by other states so companies domiciled here can do business across jurisdictions.

Why it matters: The accreditation-related sections (identified in committee as sections 4, 5, 8, 9, 10 and 11) help keep Alaska's exam and regulatory work aligned with other states. Wing Hyer told the committee that failing to adopt needed updates could require the division to return with the fixes in a subsequent session; she said accreditation sections were the most likely to trigger urgency. "If we didn't pass the bill, we would ask for it again to come back," Wing Hyer said.

Committee members also pressed division staff on provisions that affect owner-controlled and contractor-controlled insurance programs, often referred to as OCIPs and CCIPs. The current statute requires division approval for such programs and sets a construction-value threshold at $50 million. "The current statutes ' ... it has to be over $50 million," Wing Hyer said, describing the statutory limit as a legacy of prior litigation and statutory drafting. She said the Division supported a compromise that passed the other legislative body lowering that threshold for certain multi-residential projects to $25 million, provided other conditions are met.

On depreciation of labor in property insurance claims (section 53 of the draft), Wing Hyer said the division had not intended to permit depreciation of labor in residential replacement-cost claims and had missed earlier policy forms that included the clause. The bill as introduced sought to prohibit labor depreciation; an amendment adopted in the other body would allow a separate, stand-alone endorsement that discloses the premium savings and that labor would be depreciated, limited to residential lines. "If you want to accept labor depreciated, you can get it for $850," Wing Hyer said, explaining the tradeoff between lower premium and reduced claim payment for labor.

Other items covered in committee discussion included licensing updates intended to catch people who should be licensed as adjusters and housekeeping technical corrections across Title 21. Deputy Director Heather Carpenter answered questions about licensing and exemptions the division identified while preparing the bill.

No formal motion or vote on HB 148 occurred during the hearing; the session was a question-and-answer hearing to allow legislators to gather additional information before further action.

Ending: Committee members thanked the witnesses and concluded the panel. The committee will take further action on HB 148 in future meetings as the bill moves through the legislative process.