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 8, 2024
BILL NUMBER: HB 1332 BILL AMENDED: Mar 8, 2024
SUBJECT: Insurance Matters.
FIRST AUTHOR: Rep. Carbaugh BILL STATUS: Enrolled
FIRST SPONSOR: Sen. Baldwin
FUNDS AFFECTED: XGENERAL IMPACT: State & Local
XDEDICATED
FEDERAL
Summary of Legislation: Insurance Producer Education and Continuing Education Commission: The bill
establishes the Insurance Producer Education and Continuing Education Commission with appointments to
the Commission by the Commissioner of the Department of Insurance (DOI). It repeals the Insurance
Producer Education and Continuing Education Advisory Council.
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.
Health Provider Contract: The bill provides that if a party to a health provider contract intends to terminate
the contractual relationship with another party to the health provider contract, the terminating party must
provide written notice to the other party of the decision to terminate the contractual relationship not less than
90 days before the health provider contract terminates.
HB 1332 1 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.
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: Insurance Producer Education and Continuing Education
Commission: The bill repeals the Insurance Producer Education and Continuing Education Advisory Council
(Advisory Council) and establishes the Insurance Producer Education and Continuing Education Commission
(Commission) to make recommendations regarding continuing education. The Commission will be staffed
by the Department of Insurance (DOI), will consist of 7 members appointed by the DOI Commissioner, and
must meet at least twice per year. Commission members are entitled to $100 per diem and travel
reimbursement, including $0.49 per mile paid from the DOI agency fund.
Expenditures for the Commission will be mitigated by the repeal of the Advisory Council, which consisted
of the DOI Commissioner and 15 lay members, each entitled to the same per diem and travel reimbursement
as members of the new Commission. The Advisory Council last met in July 2023 and is scheduled to meet
again in March, 2024.
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. [The DOI is funded through a
dedicated agency fund.]
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.
HB 1332 2 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.
HB 1332 3