Committee hears bill to cap insurer premium-tax amendment window at three years

Chairman Lumsden presented House Bill 12-63 to the House Insurance Committee on Friday, saying the Department of Insurance bill would cap the statutory window for insurers to amend prior-year premium-tax filings at three years. Lumsden said the change is meant to align premium-tax amendments with the common three-year amendment window used for individual income tax administration.

"By capping that look back period for 3 years, consistent with the standard 3 year amendment window applicable to individual income tax filings," Lumsden said, the state would gain “certainty and predictability” for revenue forecasting. He told the committee a seven-year retrospective review by a single company in fiscal 2025 led to a refund request totaling $142,000,000 that created unanticipated budgetary disruption.

Supporters framed the measure as a narrow administrative fix rather than a bar on legitimate refunds. Lumsden said the bill "is not to prohibit insurers from correcting prior filings or seeking legitimate refunds," but to set a defined statutory boundary to avoid large, retroactive liabilities.

Committee members asked procedural and jurisdictional questions; the committee recorded the item as a "hearing only" and did not take a formal vote. Staff legislative liaisons were identified as contacts for follow-up questions. The committee will carry the record of this hearing to the full committee the next day for further consideration.

The bill’s principal effect would be to limit the period during which insurers may seek refunds on prior premium-tax filings to three years; the measure’s proponents said that would help stabilize revenue forecasting for the state. No final action was taken at the hearing.