LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
200 W. Washington St., Suite 301
Indianapolis, IN 46204
(317) 233-0696
iga.in.gov
FISCAL IMPACT STATEMENT
LS 7172 NOTE PREPARED: Feb 23, 2022
BILL NUMBER: HB 1238 BILL AMENDED: Feb 17, 2022
SUBJECT: Insurance Matters.
FIRST AUTHOR: Rep. Lehman BILL STATUS: As Passed Senate
FIRST SPONSOR: Sen. Zay
FUNDS AFFECTED:XGENERAL IMPACT: State
XDEDICATED
FEDERAL
Summary of Legislation: Minimum Nonforfeiture Amounts: The bill reduces, from 1% to 0.15%, the lowest
interest rate that an insurer may use in determining the minimum nonforfeiture amounts for an annuity
contract.
Continuing Education: The bill provides that, as a condition of license renewal, a limited lines producer with
a title insurance qualification must complete at least seven hours of continuing education in any combination
of the following subjects:
(1) Ethical practices in the marketing and selling of title insurance, including provisions of
the Dodd-Frank Wall Street Reform and Consumer Protection Act.
(2) Title insurance underwriting.
(3) Escrow matters.
(4) Matters concerning regulation by the Department of Insurance (DOI).
(5) Marketing and selling of title insurance.
Group Property and Casualty Insurance: It allows a property and casualty insurance company to offer
property and casualty insurance on a group basis to ten or more commercial, business, or not-for-profit
entities that have a preexisting relationship to one another through a common trade, an association, an
affiliation, or another organizational relationship that is separate and distinct from any group insurance
arrangement of the group.
Farm Mutual Insurance: The bill provides that an insurer, to operate as a farm mutual insurance company,
may not have annual direct written premiums of more than $15 M (instead of $10 M).
HB 1238 1 Colorectal Cancer Screening: It provides that, except for grandfathered health plans, an accident and
sickness insurance policy or health maintenance organization contract must cover or provide: (1) a colorectal
cancer screening test assigned either an "A" or "B" grade by the United States Preventive Services Task
Force; and (2) a follow-up colonoscopy.
Effective Date: July 1, 2022.
Explanation of State Expenditures: Continuing Education: The DOI uses a third-party system to track
continuing education and licensed producers are able to view their continuing education compliance status
and the continuing education hours applied. Software enhancements are provided by the system contractor
usually at no added cost.
Explanation of State Revenues: Premium Taxes: Group policies may allow for discounts or otherwise
reduce the premium for the associations. If premiums are lower, insurance premium tax revenue to the state
General Fund could decrease. Alternatively, premium tax revenue to the state General Fund could increase
to the extent that investment in annuity contracts are an alternative to other interest bearing investments
based on changes to the minimum nonforfeiture amounts.
Domestic insurers have the option to pay taxes on insurance premiums written in the state or to pay the AGI
tax. Foreign insurers are required to pay taxes on premiums written in the state, and some foreign insurers
are assessed additional retaliatory taxes. In these cases, the minimum tax rate would be 1.3% of written
premiums. Revenue received from the AGI and insurance premium tax is deposited in the General Fund.
Explanation of Local Expenditures:
Explanation of Local Revenues:
State Agencies Affected: Department of Insurance.
Local Agencies Affected:
Information Sources:
Fiscal Analyst: Karen Rossen, 317-234-2106, Randhir Jha, 317-232-9556.
HB 1238 2