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 6979 NOTE PREPARED: Mar 5, 2024
BILL NUMBER: HB 1332 BILL AMENDED: Mar 4, 2024
SUBJECT: Department of Insurance Regulatory Matters.
FIRST AUTHOR: Rep. Carbaugh BILL STATUS: As Passed Senate
FIRST SPONSOR: Sen. Baldwin
FUNDS AFFECTED: XGENERAL IMPACT: State & Local
XDEDICATED
FEDERAL
Summary of Legislation: Alien or Foreign Insurance Company: The bill repeals the law requiring an alien
or foreign insurance company to annually submit to the DOI a condensed statement of its assets and liabilities
and requiring the DOI to publish the statement in a newspaper.
Regulation of Insurance: It adds to the law on the regulation of insurance holding company systems
provisions concerning liquidity stress testing according to the framework established by the National
Association of Insurance Commissioners.
Insurance Administrators: The bill amends the law on insurance administrators to set forth certain
circumstances under which an insurance administrator is required to apply to Indiana for a license.
Written Notice: The bill requires an insurer to mail a written notice of nonrenewal to an insured at least 60
days before the anniversary date of the policy if the coverage is provided to a municipality or county entity.
Prescription Drug Rebates: It amends the law on individual prescription drug rebates and the law on group
prescription drug rebates to authorize the DOI to adopt rules for the enforcement of those laws and to specify
that a violation of either of those laws is an unfair or deceptive act or practice in the business of insurance.
Options: The bill requires an insurer to only offer to plan sponsors the following plans:
(1) A plan that applies 100% of the rebates to reduce premiums for all covered individuals equally.
(2) A plan that calculates defined cost sharing for covered individuals of the plan sponsor at the point
of sale based on a price that is reduced by an amount equal to at least 85% of all of the rebates received or
estimated to be received by the insurer.
HB 1332 1 Applicability: The bill changes the date of applicability for provisions regarding a notice of material change
from after June 30, 2024, to after June 30, 2025.
Property and Casualty Insurance: It amends the property and casualty insurance guaranty association law
concerning the allocation, transfer, or assumption by one insurer of a policy that was issued by another
insurer.
Effective Date: June 30, 2024; July 1, 2024.
Explanation of State Expenditures: Department of Insurance (DOI): Violations of individual and group
prescription drug rebates are actionable by the DOI as unfair and deceptive acts. The agency workload could
increase to investigate and adjudicate allegations to determine if an unfair or deceptive act has been
committed. Increases in DOI workload are expected to be accomplished within existing resource and funding
levels.
Explanation of State Revenues: Unfair and Deceptive Acts: The DOI Commissioner may take
administrative actions concerning unfair and deceptive acts that will impact revenue to the state General
Fund and the DOI’s agency fund. The penalty for engaging in unfair and deceptive acts is a civil penalty
between $25,000 and $50,000 for each act or violation, which is deposited into the state General Fund.
Third Party Administrator (TPA) Licenses: The bill could lead to additional administrators applying for
licensure in Indiana, which could increase license fee revenue. The current fee for TPA licenses is $50.
Additional Information: According to the DOI, there are currently 380 licensed TPAs, of which, 84 are
resident licenses.
Explanation of Local Expenditures: The bill impacts local units of government who offer group
prescription drug coverage. The bill requires an insurer to offer two options to employers to choose from for
their group plans. Any changes resulting from the bill is indeterminate.
Explanation of Local Revenues:
State Agencies Affected: Department of Insurance.
Local Agencies Affected: Local units offering group prescription drug coverage.
Information Sources: Claire Szpara, Department of Insurance; Legislative Services Agency, Indiana
Handbook of Taxes, Revenues, and Appropriations, FY 2023; IC 25-1-50.
Fiscal Analyst: Jasmine Noel, 317-234-1360.
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