Committee advances insurance bill 2374 after lengthy debate over managed repair program and vendor steering

The Industry, Business and Labor Committee voted to advance bill 2374, adopting a set of insurance-industry amendments introduced by the Insurance Department and approving the bill "do pass as amended" after extended debate over a managed repair program that would let insurers offer premium reductions or other incentives in exchange for customers using approved contractors.

Deputy Insurance Commissioner John Arnold walked the committee through the department's draft amendments, explaining several significant changes. The department removed a proposed blanket prohibition on rebates tied to crop insurance and returned the bill to its original intent on that point. Arnold said the amended language also clarifies that sections 1 and 2 would not apply to "large commercial risks" and referenced the statutory definition: "a large commercial risk means an insured that has a total insured property value of $25,000,000 or more, total annual gross revenue of $50,000,000 or more, or a total premium of $100,000 or more for property insurance, ... $200,000 or more for multi payroll insurance." He said the higher thresholds were intended to exclude many farm policies from the large-commercial exemption.

On arbitration, Arnold said the amendment from the surplus-lines industry clarifies…