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Georgia premium tax explained: $1.85 billion collected in 2024 and key revenue for cities and counties
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Summary
The Insurance Department told the committee Georgia collected about $1.85 billion in premium tax in 2024; cities and counties may levy additional local premiums (1% life, 2.5% other). Local officials explained those receipts subsidize police, fire and public‑works budgets and reduce pressure on property tax mills.
Department of Insurance staff briefed the House Insurance Rate Study Committee on premium tax mechanics and local impacts. The department said it collected about $1.85 billion in premium tax in calendar 2024; roughly $744 million was transferred to the state treasury and about $1.1 billion distributed to cities and counties.
Bryce Rawson and Manny Snipes summarized that Georgia’s state premium tax rate is 2.25% on admitted companies’ gross direct premiums (non‑admitted surplus lines higher, roughly 4%), and that counties and municipalities may add a local premium tax (1% maximum for life, 2.5% for other lines). The department explained abatements that lower the state portion when companies invest a significant share of assets inside Georgia (a 25% in‑state investment lowers the state rate toward 1.25%; a 75% in‑state investment can reduce it toward 0.5%). Distributions are allocated by population and typically paid Oct. 15 of each year.
Local officials from the Georgia Municipal Association and ACCG told the committee that premium‑tax revenues are material to municipal and county budgets and often fund police, fire and public‑works services. Case studies presented showed jurisdictions in which insurance premium tax accounted for between about 5% and 13% of municipal general‑fund revenue and subsidized significant shares of public‑safety budgets. County representatives added that timing matters: counties budget across the year and rely on the October distribution for cash flow and to avoid mid‑year budget stress.
Committee members asked the department for further analysis of how changing the state portion could affect domiciliary/retaliatory tax mechanics and whether a rate change could produce a net revenue neutral result once retaliatory effects are included; the department agreed to provide updated modeling prior to the December meeting.
