SB 0757 - Fiscal Note

Fiscal Note - SB 0757 - Expands the obligation of the Property and Casualty Guaranty Fund

COMMITTEE ON LEGISLATIVE RESEARCH

OVERSIGHT DIVISION

FISCAL NOTE

L.R. NO. 3305-02

BILL NO. SB 757

SUBJECT: Insurance - General; Insurance - Property; Insurance - Automobile; Liability

TYPE: Original

DATE: January 30, 1998

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FISCAL SUMMARY

ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
General Revenue	$0	(more than $100,000)	(more than $100,000)
County Stock Insurance	$0	$0	$0
County Foreign Insurance Tax	$0	$0	$0
Total Estimated Net Effect on All State Funds	$0	(more than $100,000)	(more than $100,000)

ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
None
Total Estimated Net Effect on All Federal Funds	$0	$0	$0

ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
Local Government	$0	(more than $100,000)	(more than $100,000)

Numbers within parentheses: ( ) indicate costs or losses

This fiscal note contains 4 pages.

FISCAL ANALYSIS

ASSUMPTION

Officials from the Department of Insurance (INS) assume this proposal would result in additional fiscal impact in the event that new claims against the Property and Casualty Guaranty Association (PCGA) exceed the prior limitations. INS states that payments made to fund the PCGA are deducted from the insurers premium tax payments. INS assumes increased payments from the PCGA would increase deductions and reduce premium tax revenue. INS further assumes the fiscal impact for this proposal is undeterminable but could be greater than $100,000 per fiscal year.

FISCAL IMPACT - State Government	FY 1999	FY 2000	FY 2001
	(10 Mo.)
GENERAL REVENUE FUND
Loss - Department of Insurance
Reduced premium tax receipts	$0	(more than	(more than
		$100,000)	$100,000)
ESTIMATED NET EFFECT ON
GENERAL REVENUE FUND	$0	(more than	(more than
		$100,000)	$100,000)
COUNTY STOCK INSURANCE FUND
Loss - Department of Insurance
Reduced premium tax receipts	$0	(more than	(more than
		$100,000)	$100,000)
Savings - Department of Insurance
Reduced transfers	$0	more than	more than
		$100,000	$100,000
ESTIMATED NET EFFECT ON
COUNTY STOCK INSURANCE FUND	$0	$0	$0
FISCAL IMPACT - State Government	FY 1999	FY 2000	FY 2001
(continued)	(10 Mo.)
COUNTY FOREIGN INSURANCE
TAX FUND
Loss - Department of Insurance
Reduced premium tax receipts	$0	(more than	(more than
		$100,000)	$100,000)
Savings - Department of Insurance
Reduced transfers	$0	more than	more than
		$100,000	$100,000
ESTIMATED NET EFFECT ON
COUNTY FOREIGN INSURANCE
TAX FUND	$0	$0	$0
FISCAL IMPACT - Local Government	FY 1999	FY 2000	FY 2001
	(10 Mo.)
LOCAL GOVERNMENTS
Loss - Department of Insurance
Reduced premium tax receipts	$0	(more than	(more than
		$100,000)	$100,000)
ESTIMATED NET EFFECT ON
LOCAL GOVERNMENTS	$0	(more than	(more than
		$100,000)	$100,000)
FISCAL IMPACT - Small Business

Small businesses would be expected to be fiscally impacted to the extent that they would incur additional costs for assessments from the Property and Casualty Guaranty Association and savings from reduced premium tax payments as a result of the requirements of this proposal.

DESCRIPTION

This proposal would expand the obligation of the Missouri Property and Casualty Guaranty DESCRIPTION (continued)

Association for the claims of insolvent insurers. The obligation for claims from bodily injury, sickness and disease would be no longer limited to medical expenses and lost wages. The policy limit would be the maximum obligation, except that punitive damages would not be included in any covered claim, and the overall limit of $300,000 would still apply.

This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.

SOURCES OF INFORMATION

Department of Insurance

Jeanne Jarrett, CPA

Director

January 30, 1998