Bill Description: House Bill 618 would impose new regulations and reporting requirements on fire insurers.
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Does it give government any new, additional, or expanded power to prohibit, restrict, or regulate activities in the free market? Conversely, does it eliminate or reduce government intervention in the market?
House Bill 618 would create Section 41-2402, Idaho Code, to impose what it calls “transparency requirements” on fire insurers, ignoring that transparency is something government owes to the people, not something the people owe to it.
The bill would require fire insurers to “submit complete rate filings to the director of the department of insurance at least sixty (60) days prior to use” and include any “wildfire risk model, catastrophe model, or wildfire risk scoring method” used to assign risk. The insurer would be required to provide “a description of the model, the impact of the model on rates, an actuarial justification for all rating factors, mitigation discounts offered, and an explanation of the use of the model in underwriting decisions.”
These are not just heavy new reporting requirements; they may well compel fire insurers to disclose proprietary information, which could compromise their business practices and put them at a competitive disadvantage in the larger market.
The bill would require fire insurers to publicly disclose on its website any premium discounts, incentives, or other premium adjustments that are available to policyholders who undertake property-specific mitigation actions or provide evidence of community-level mitigation actions.
They would also have to provide a process for appealing a wildfire risk score and identify property-specific mitigation actions for the policyholder to undertake and community-level mitigation actions that could result in a discount, incentive, or other premium adjustment; and the amount of the discount, incentive, or other premium adjustment associated with each action.
They would have to regularly disclose to policyholders any mitigation discounts, wildfire risk scores, or any other wildfire risk classifications used by the insurer.
The bill imposes a variety of other mandated disclosures and related time constraints (some as little as 15 days) on fire insurers.
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Does it create, expand, or enlarge any agency, board, program, function, or activity of government? Conversely, does it eliminate or curtail the size or scope of government?
The bill says, “The department of insurance shall annually collect information from fire insurers regarding Idaho-specific exposures, premiums, claims, and related information. The department shall determine the applicability, scope, method, and exact data requested for such annual data collection.”
The bill would also require the department to “make available on its public website information to educate consumers, including but not limited to anonymized and aggregated data from the annual data collection” and “basic information regarding fire or property insurance, such as coverage availability, exclusions, premiums, and mitigation discounts.”
It would also give the department authority to promulgate rules related to this new section of code.
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