This Fiscal Note is not an official copy and should not be quoted or cited.
This Fiscal Note is not an official copy and should not be quoted or cited.
Fiscal Note - SB 0221 - Expands the obligation of the Property and Casualty Guaranty Fund for insolvent insurer claims
COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. NO. 1018-01
BILL NO. SB 221
SUBJECT: Insurance
TYPE: Original
DATE: January 25, 1999
FISCAL SUMMARY
|
ESTIMATED NET EFFECT ON STATE FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| General Revenue* | $0 | (Unknown) | (Unknown) |
| County Stock Insurance | $0 | $0 | $0 |
| County Foreign Insurance Tax | $0 | $0 | $0 |
| Total Estimated
Net Effect on All State Funds* |
$0 | (Unknown) | (Unknown) |
* Loss of revenue expected to exceed $100,000.
|
ESTIMATED NET EFFECT ON FEDERAL FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| None | |||
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
|
ESTIMATED NET EFFECT ON LOCAL FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| Local Government* | $0 | (Unknown) | (Unknown) |
Numbers within parentheses: ( ) indicate costs or losses
This fiscal note contains 4 pages.
FISCAL ANALYSIS
ASSUMPTION
The Department of Insurance (INS) assumes that an increase in payments from the Property and Casualty Insurance Guaranty Association will result in increased assessments against solvent insurers. These assessment payments are taken as credits against an insurers premium tax payments; therefore, these increased payments would increase deductions and reduce premium tax revenue collected by the state. Because the extent new claims against the Association will exceed prior limitations is not known, INS assumes the fiscal impact of this proposal is undeterminable but could exceed $100,000 per fiscal year.
| FISCAL IMPACT - State Government | FY 2000 | FY 2001 | FY 2002 |
| (10 Mo.) | |||
| GENERAL REVENUE | |||
| Loss - Department of Insurance | |||
| Reduced premium tax receipts* | $0 | (Unknown) | (Unknown) |
|
ESTIMATED NET EFFECT | |||
| ON GENERAL REVENUE* | $0 | (Unknown) | (Unknown) |
| * Loss of revenue expected to exceed $100,000. | |||
| COUNTY STOCK INSURANCE FUND | |||
| Loss - Department of Insurance | |||
| Reduced premium tax receipts | $0 | (Unknown) | (Unknown) |
| Savings - Department of Insurance | |||
| Reduced transfers | $0 | Unknown | Unknown |
|
ESTIMATED NET EFFECT ON |
|||
| COUNTY STOCK INSURANCE FUND | $0 | $0 | $0 |
| FISCAL IMPACT - State Government | FY 2000 | FY 2001 | FY 2002 |
| (continued) | (10 Mo.) | ||
| COUNTY FOREIGN INSURANCE TAX FUND | |||
| Loss - Department of Insurance | |||
| Reduced premium tax receipts | $0 | (Unknown) | (Unknown) |
| Savings - Department of Insurance | |||
| Reduced transfers | $0 | Unknown | Unknown |
|
ESTIMATED NET EFFECT ON |
|||
| COUNTY FOREIGN INSURANCE | |||
| TAX FUND | $0 | $0 | $0 |
| FISCAL IMPACT - Local Government | FY 2000 | FY 2001 | FY 2002 |
| (10 Mo.) | |||
| LOCAL GOVERNMENT | |||
| Loss - Department of Insurance | |||
| Reduced premium tax receipts* | $0 | (Unknown) | (Unknown) |
|
ESTIMATED NET EFFECT ON |
|||
| LOCAL GOVERNMENT* | $0 | (Unknown) | (Unknown) |
| * Loss of revenue expected to exceed $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 expands the obligation of the Missouri Property and Casualty Guaranty Association for the claims of insolvent insurers. The obligation for claims from bodily injury,
sickness, and disease is no longer limited to medical expenses and lost wages. The policy limit or $300,000, whichever is less, will be the maximum obligation.
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 25, 1999