Bill Text: HI HB2603 | 2018 | Regular Session | Amended
Bill Title: Relating To State Self-insurance Against Property And Casualty Risks.
Spectrum: Partisan Bill (Democrat 14-0)
Status: (Engrossed - Dead) 2018-03-13 - Re-Referred to GVO/CPH, WAM. [HB2603 Detail]
Download: Hawaii-2018-HB2603-Amended.html
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
2603 |
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TWENTY-NINTH LEGISLATURE, 2018 |
H.D. 1 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO STATE SELF-INSURANCE AGAINST PROPERTY AND CASUALTY RISKS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The State currently purchases third-party insurance through its risk management and insurance administration to cover the State's property and casualty risks. The State's property and casualty insurance premium costs are approximately $19,000,000 per year.
The purpose of this Act is to save the
State the costs of its annual insurance premiums for property and casualty
insurance coverage by self-insuring the State's property and casualty risks.
SECTION 2. Chapter 41D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:
"§41D- State
self-insurance against property and casualty risks special fund. (a)
There is established in the state treasury the state self-insurance against
property and casualty risks special fund to be administered by the comptroller,
through the risk manager.
(b) Moneys in the special fund shall be used to provide the State
with self-insurance coverage against property and casualty risks pursuant to section
41D-2(a)(1) and (2). The special fund
shall pay claims to state agencies for losses to property of the State
caused by fire or other casualty, including the cost to:
(1) Repair or
replace buildings and other structures;
(2) Replace damaged
contents; and
(3) Provide
alternate structures while damaged structures are being repaired or replaced.
(c) Moneys in excess of the amounts necessary for
meeting the immediate requirements of the special fund may be invested as
provided in section 36-21. Interest
earned by the special fund shall be credited to the special fund.
(d)
To ensure that the special fund is operated on an actuarially sound
basis, the governor shall authorize the annual transfer of $19,000,000 in
general funds to the special fund.
(e)
The comptroller may establish deductibles for the state agencies for
certain perils or classes of property or casualty risks and may:
(1) Assess
the agencies for losses incurred in the amount of the deductible; or
(2) Reduce
the payment from the special fund to cover the property or casualty loss by the
amount of the deductible.
(f)
For any year in which the balance in the special fund is
insufficient to keep the special fund actuarially sound and pay the claims
required under subsection (b), the comptroller shall request that the governor
authorize an advance to the special fund of sufficient sums of money from other
funds in the state treasury.
(g)
The moneys advanced to the special fund pursuant to subsection
(f) shall be repaid from the special fund in annual installments, with
interest. The amount of each annual installment
shall be fixed by the comptroller so that the moneys advanced can be reasonably
expected to be repaid in not more than ten years.
(h) To ensure that moneys advanced to the special fund are repaid as specified in subsection (g), the comptroller may further assess the state agencies."
SECTION 3. Section 41D-2, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) The comptroller, through the risk manager,
shall:
(1) [Have
discretion to purchase casualty insurance for] Establish and administer
self-insurance coverage against casualty risks of the State [or state
agencies], including those employees of the State who, in the comptroller's
discretion, may be at risk [and shall be responsible for the acquisition of
all casualty insurance];
(2) [Have
discretion to purchase property insurance for] Establish and
administer self-insurance coverage against all property risks of the State [or
state agencies and shall acquire all property insurance];
(3) Direct and manage all risk management and insurance programs of the State, except for employee benefits insurance and workers' compensation insurance programs or as otherwise provided in chapters 87A, 88, 383 to 386A, 392, and 393;
(4) Consult with state
agencies to determine what [property, casualty, and other] insurance
policies, other than self-insurance coverage against property and casualty
risks, are presently in force or are sought by the state agencies and to
make determinations about whether to continue subscribing to insurance
policies. In the event that the risk
manager's determination is not satisfactory to the state agency, the state
agency may have the risk manager's decision reviewed by the comptroller. In this case, the comptroller's decision shall
be final;
(5) Consolidate and combine state insurance coverages, and purchase excess insurance when, in the comptroller's discretion, it is appropriate to do so;
(6) Acquire risk management, investigative, claims adjustment, actuarial, and other services, except attorney's services, as may be required for the sound administration of this chapter; provided that a broker submitting a proposal in response to a fixed fee solicitation by the comptroller pursuant to this subsection and the broker's performance of the activities in accordance with the proposal shall not constitute a violation of sections 431:10-218, 431:13‑102, and 431:13-103;
(7) Gather from all state agencies and maintain data regarding the State's risks and casualty, property, and fidelity losses;
(8) In conjunction with the attorney general and as otherwise provided by this chapter, compromise or settle claims cognizable under chapter 662;
(9) Provide technical services in risk management and insurance to state agencies;
(10) Be authorized to establish a captive insurance company pursuant to article 19 of chapter 431 to effectuate the purposes of this chapter; and
(11) Do all other
things appropriate to the development of sound risk management practices and
policies for the State."
SECTION 4. Section 41D-4, Hawaii Revised Statutes, is amended to read as follows:
"§41D-4 State risk management revolving fund.
(a) The state risk management
revolving fund is created and shall be funded in amounts reasonably necessary
to:
(1) Carry
out the responsibilities of the comptroller established in section 41D-2[;],
but excluding section 41D-2(a)(1) and (2);
[(2) Pay
claims to state agencies for losses to property of the State caused by fire or
other casualty, including the cost to repair or replace buildings and other
structures, replace damaged contents, and to provide alternate structures while
damaged structures are being repaired or replaced;
(3)] (2) Pay claims against the State under sections
662-11, 41D-3, and 41D-8; and
[(4)] (3) Pay for losses to the State incurred by the
dishonesty, nonfeasance, or misfeasance of any officer or employee of the State
or for any losses to the State through larceny, theft, embezzlement, forgery,
misappropriation, wrongful abstraction, wilful misapplication, or any other
fraudulent or dishonest act committed by one or more of the employees of the
State acting directly or in collusion with others.
(b)
In addition to any appropriation the legislature shall make to the state
risk management revolving fund, the comptroller may apportion to, and collect
from, state agencies those amounts of money that, in the discretion of the
comptroller, reflect benefits received by the agencies under this chapter. The comptroller may consider the relevant
risk and loss experience of the agencies in making apportionments and
assessments. Funds so collected shall be
deposited into the state risk management revolving fund.
[(c)
The comptroller may establish deductibles for the state agencies for
certain perils or classes of property losses and may:
(1) Assess
the agencies for losses incurred in the amount of the deductible; or
(2) Reduce
the payment from the state risk management revolving fund to cover the casualty
loss by the amount of the deductible.
(d)] (c) The comptroller may establish a formula for
refunds to the state agencies based upon the agencies' risk and loss
experience.
[(e)] (d) Money in the state risk management revolving
fund shall be expended only for the purposes delineated in subsection (a) and
only upon the authority of the comptroller, who is given discretion when to
permit expenditures from the fund. Money
in the state risk management revolving fund shall not be garnished, attached,
or otherwise subjected to legal compulsion to pay actual or alleged obligations
of the State, any state agency, or any state employee.
[(f)] (e) The comptroller shall prepare, for each
fiscal year, a report of all claims arbitrated, compromised, or settled for
$10,000 or less paid from the state risk management revolving fund. The report shall be submitted to the
legislature twenty days prior to the commencement of the regular session next
succeeding the year for which the report is made.
[(g)] (f) Money received from the settlement of claims
or losses of the State as delineated in subsection (a) shall be deemed to be
trust moneys and may be deposited into the state risk management revolving fund
or into a trust account with and under the control of the affected agency at
the discretion of the comptroller. These
moneys and any interest earned thereon shall be used for the purpose identified
in any such settlement."
SECTION 5. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2018-2019 for deposit into the state self-insurance against property and casualty risks special fund.
The sum appropriated shall be expended by the department of accounting and general services for the purposes of this Act.
SECTION 6. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 7. This Act shall take effect on July 1, 3000.
Report Title:
Self-Insurance; State Property and Casualty Risks
Description:
Establishes a special fund to provide the State with self-insurance against the State's property and casualty risks. Appropriates moneys. (HB2603 HD1)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
