House panel adopts substitute to force insurers to check child-support liens before payouts

The House Insurance Committee on April 14 adopted a substitute for House Bill 943 that would require insurers to check for delinquent child-support obligations before issuing qualifying settlement payments.

Chairman Furman, sponsor of the measure, said the bill creates a straightforward process so that “when deadbeat dads get an insurance settlement for things like lost wages, pain and suffering, and mental anguish, we want to make sure their kids are paid what is owed to them in late child support.”

Charles Watkins, assistant secretary for family support at the Department of Children and Family Services, told the committee Louisiana currently lacks a mechanism to capture many bodily-injury settlements for noncustodial parents who owe back child support and that the bill would give DCFS another tool to collect arrears. “This law would put that in place so that DCFS would have another tool in her tool belt to make sure that the children of Louisiana are supported,” he said.

During questioning committee members clarified how the process would work: insurers would run a data-match search against a DCFS-maintained service; if a name matches and a lien exists, DCFS would communicate the amount owed and the insurer would withhold that sum from the settlement and remit it to DCFS. The committee also discussed the statutory priority of payments — attorney fees, litigation expenses, property damage, medical bills and burial expenses take priority over child-support withholding — and how unconditional tenders or multiple tenders are handled in practice.

Insurance Commissioner Tim Temple voiced support and cited the Gulf Coast Claims Facility as an example of large-scale coordination between payors and state agencies that can work smoothly.

The committee adopted the posted substitute (No. 3604) and, with no objections, reported HB 943 as substituted. The committee did not record a roll-call tally.