Insurance Department seeks authority to order restitution for consumers harmed under Title 26.1

The Committee on Industry and Business heard testimony March 4 on House Bill 1088, which would allow the Insurance Commissioner to order restitution to consumers financially harmed by violations of Title 26.1.

John Arnold, deputy insurance commissioner, told the committee HB 1088 would add a restitution option to the department’s existing enforcement tools. The department currently may impose administrative fines “up to $10,000 per violation,” Arnold said, but those fines are paid to the state rather than directly to harmed consumers. He said the department has relied on the threat of that fine to negotiate payments to consumers in small, common cases such as an insurer charging an unapproved rate.

Arnold testified the bill is a response to a recent, “egregious” case in which a family incurred more than $500,000 in medical debt after buying what they believed was self‑insurance; the deputy commissioner…