House subcommittee advances bill aimed at easing insurance rates, adopts fraud and deductible changes

A House Banking and Insurance insurance subcommittee advanced House Bill 48 17, a package of measures the committee said is intended to improve availability and affordability of residential property and personal auto insurance.

Representative Brewer, who presented the bill, said HB 48 17 grew out of an insurance rate-review ad hoc committee and combines steps to tackle insurance fraud, predatory roofing practices, mitigation incentives and policyholder protections. "48 17 is a bill that seeks to improve the availability and affordability of residential property and casual casualty insurance and personal auto insurance in our state by tackling insurance fraud and predatory roofing practices, enhancing mitigation incentives and tax credits," Brewer said.

The bill drew a series of amendments the committee adopted. Amendment 1 clarifies the referral process between the Department of Insurance's fraud unit and licensing boards so that the Residential Builders Commission or Contractors Licensing Board may fully prosecute licensees when appropriate. "This amendment comes from testimony we heard from LLR that deals with moving the roofing fraud investigation unit over to the insurance fraud unit," Brewer said.

Amendment 2 adds criminal definitions and penalties intended to give the fraud unit more enforcement power, including new felonies for staging motor vehicle collisions and aggravated staging when injuries or death result. Brewer summarized the proposed penalties: first offenses could carry up to 10 years in prison and fines up to $10,000; higher penalties apply for repeat offenses and for cases involving serious injury or death. Representative Kirby praised the emphasis on fraud, calling it "one of the most important" issues the rate review committee addressed.

Amendment 3 strikes a so-called "no pay, no play" provision that would have limited recovery for not-at-fault uninsured drivers. Brewer said the section crossed into tort reform, outside the ad hoc committee's scope, and moved to remove it; the committee adopted the change.

The committee debated an Amendment 4 substitute that would remove mandatory $0 auto-glass deductible language, add a bridge preserving current law through Dec. 31 and delay related implementation until Jan. 1, 2027, to give carriers time to update systems. Representative Doctor Johnson questioned whether carriers could guarantee that the change would lower premiums, asking, "Is there a carrier in here who can speak to that that can say, hey, we're gonna bring the rates down if we change this?" Brewer responded that no guarantee exists but argued removing mandates and increasing competition is a path to lower rates.

Brewer also introduced Amendment 5 directing the Department of Insurance to set benchmarks for premium discounts to provide certainty to consumers and the industry; the committee adopted the amendment and said further details would be considered in the continuing ad hoc committee.

With the amendments adopted and no further discussion, the Chair put the pending question and the committee gave HB 48 17 a favorable report by voice vote. "The bill passes and will be sent to the floor," the Chair announced.

The committee said the insurance rate-review ad hoc committee will remain active to monitor results and consider additional adjustments as needed.