Federal – The Insurance Information Act of 2008, HR 5840, was recommended for passage by a U.S. House of Representatives subcommittee on July 9. The bill, introduced in April, would create a federal-level Office of Insurance Information within the Department of the Treasury that would provide legislators with expertise and guidance on insurance issues and recommend how the government should respond to insurance issues.

The bill’s progress incited happiness in some and concern in others within the insurance industry.

“The Office of Insurance Information could be a tremendously valuable tool for enabling the U.S. to speak with one voice on important insurance matters and for establishing U.S. leadership globally on developing international standards for insurance regulation,” said Gov. Marc Racicot, president of the American Insurance Association (AIA).

However, Property Casualty Insurers Association of America’s president and CEO, David A. Sampson, said the bill needs to be considered carefully.

“It is important to ensure that insurance regulatory reform legislation will produce efficiencies and meaningful results without creating additional onerous, costly bureaucracy,” Sampson said.

California – The California Assembly approved the fifth revision of Senate Bill 1371 (Sen. Lou Correa, D-Santa Ana) – legislation designed to limit the insurance company practice of placing “caps,” arbitrary limits, on reimbursements for collision repairs – on July 14 with a 75-0 vote.

In February, when the bill was introduced in the Senate, it stated, “No insurer shall recommend, apply, or include any arbitrary limit, cap, or threshold when adjusting labor, parts, or other material on any written automobile repair estimate.”

In April, the Senate added a definition of capping to the bill. After several revisions, the Senate’s final version defined capping as “offering or paying an amount that is unrelated to an accepted industry methodology used in determining paint and materials charges.” This version was unanimously approved in April.

The bill next moved to the Assembly, where capping was finally defined in June as “offering or paying an amount that is unrelated to a methodology used in determining paint and materials charges that is accepted by automobile repair shops and insurers.” This revised version of the bill now must return to the Senate for re-approval.

Massachusetts – The Massachusetts Auto Body Labor Rate Bill, H.B. 1085, is one signature away from approval. Governor Deval Patrick was given the bill, which is attached to the state’s Budget Conference Report, on July 3.

The bill – which was introduced in January of 2007 by the Massachusetts chapter of the Alliance of Automotive Service Providers (AASP MA/RI) and the Central Massachusetts Auto Rebuilders Association (CMARA) and sponsored by State Rep. Robert Spellane (D-Worcester) – calls for a special commission that would study the way labor rates are set and investigate the benefits and costs of developing a rate-setting system, including a shop rating system, average national rates and using a Bureau of Labor Statistics (BLR) multiplier based on Massachusetts labor wages. The commission would also look into the number of existing shops in the state and the number that have closed since 2000. This bill also requires the commission to hold at least two public hearings and file a report that includes legislative or regulatory recommendations by Dec. 31.

If Gov. Patrick approves the bill, the commission will consist of three representatives from the collision industry – two will be appointed by AASP MA/RI and one from MSADA – three insurance industry representatives and five state legislators. The state secretary of consumer affairs and business regulation would select the commission’s chairperson.

For more information, visit www.passthelaborratebill.org.

 Michigan – The Automotive Service Association (ASA) is urging independent automotive repairers in Michigan to contact their state senators in response to the proposed increase of the mini-tort law to $1,500, allowing drivers to seek more damages from at-fault motorists after a crash. State Rep. Tim Melton introduced the proposal, Michigan H.B. 5838, in February. The bill passed the House and is now before the Senate.

Under Michigan’s no-fault automobile insurance system, motorists typically use their own insurance policies for payment in case of an accident or injury. However, state law provides for a “mini-tort,” which allows a driver to seek to recover the amount of the deductible – in his or her personal insurance or auto insurance policy – from the at-fault driver in an accident. Specifically, the code allows a driver to seek damages not covered by insurance. The current cap on the mini-tort is $500, and this legislation would increase it to $1,500.

ASA believes the current law is outdated and asks that all independent automotive repair professionals in Michigan contact their state senator and urge them to support changes to the mini-tort law.

To view Michigan H.B. 5838 and to send a letter in support, visit ASA’s legislative Web site, www.takingthehill.com. The link can be found by clicking the “Legislative Alert Center.” Click the “Current Alerts” link in the upper right corner of the page and then look under “State Legislative” and “Agency” to find the pre-written letter that can be sent via e-mail to Michigan senators.

For additional information about ASA, visit www.asashop.org.

Pennsylvania –  Joel S. Ario, Pennsylvania’s acting insurance commissioner, was appointed insurance commissioner by a unanimous state senate vote July 3. Gov. Ed Rendell first nominated Ario for the position in June 2007.

“Joel Ario is a highly qualified and seasoned administrator with a strong and proven record of fighting to protect the rights and needs of consumers,” Rendell said in June 2007.

Ario was Oregon’s chief insurance regulator before coming to Pennsylvania. Ario is chair of the National Association of Insurance Commissioners (NAIC) health committee and was chair of the NAIC market regulation and consumer affairs committee from 2001 to 2004.

Ario holds degrees from Harvard Law School, Harvard Divinity School and St. Olaf College in Northfield, Minn.