8/16/2019 Wade Letter About Insurance Bill

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KA

THARINE L

W

ADE

INSURANCE

CO

MMISSION

ER

P.O. B

ox 816

HARTFO

RD

  CT

06

142 08 16

March 29, 2016

Senator Joseph J Crisco

Representative Robert W.

Megna

o Oionn ei:tii:ut

Co-Chairs, Insurance and Real Estate Committee

Legislative Office Building, Room 2800

Hartford, Connecticut

Re: S.B. No.

159, An Act Concerning the Insurance Department s Market Conduct

Authority and Data Call Confidentiality

Dear Senator Crisco, Representative Megna, Senator Kelly, Representative Sampson, and Committee

Members:

The

Connecticu t Insurance Department (the Department ) is very committed to serving consumers

in

a

professional and timely manner by providing assistance and information to the public and to policy

makers, by regulating the insurance industry in a fair and efficient manner which promotes a competitive

and financially sound insurance market for consumers, and by enforcing the insurance laws to ensure that

consumers are treated fairly and are protected from unfair practices.

I write to you concerning SB 159 which was developed in consultation with the Governor s Office. This

legislation strikes the correct balance of giving the Department the authority to issue data calls to a

segment

of

the industry it regulates for the submission

of

specific commercial or financial information.

This allows the Department to appropriately administer and enforce the provisions of the insurance

statutes, while protecting the regulated entity from the harmful effects of having individually identifiable

information available to its business competitors pursuant to a Freedom of Information Act request.

The Department has reviewed the comments of Demian Fontanella of the Office of Healthcare Advocate

in a March 7 letter to the Committee co-chairmen and ranking members concerning Section 2 of SB 159.

Mr. Fontanella contends that the legislation is overly broad and urges the removal of this section from the

bill by raising a host

of

concerns . Those concerns, however, reflect a lack

of

understanding

of

the

operative effect of this legislation and the apparent lack of due regard that government agencies must act

in a responsible and effective manner to protect the public interest. It

is

the balance regulators must strike

in order to not unnecessarily cause harm to persons and businesses that seek to be compliant with

government requests for information.

Mr. Fontanella takes issue with the lack

of

a definition of the term data call. It is not clear to the

Department whether Mr. Fontanella researched the laws

of

other states. Had he done so, he would have

noted that

it

is a commonly understood term that is referenced

in

legislation without need

offurther

definition. Mr. Fontanella simplified and failed to put

in

proper context the Department' s recent property-

casualty data call.

n

actuality, the Department requested very specific proprietary data to help the

8/16/2019 Wade Letter About Insurance Bill

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Department determine statewide availability and affordability

of

homeowners' insurance, which was done

for regulatory purpose and to inform the public policy discussion.

Mr. Fontanella boldly asserts that this legislation could be used to automatically transform the public

information the Department receives and generates in its review

of

Form A mergers or insurance rates

into confidential non-public information.

This is simply legally correct

•

The

Form A (merger) filing and rate filing information is legally required to be disclosed under

Conn. Gen. Stat. § 1-21 O b)(5)(B). This section makes clear that any commerc ial or financial

information collected by a state agency that is required by statute is required to be disclosed.

Form A filings and rate filings both contain commercial and financial information, but they are

required to be filed with the Department pursuant to Conn. Gen. Stat.§ 38a-130 and Conn. Gen.

Stat. § 3 Sa-481 respectively. The Department posts the associated information on its internet

website for the public to view.

t

is important to note that Section 2 of raised SB 159 will not

jeopardize these public disclosures, which are protected under laws this Legislature has passed.

This provision of the law does not apply to the public hearings held in Form A proceedings.

Those are governed instead by Conn. Gen. Stat.§ 38a-132. Under Conn. Gen. Stat.§ 38a-132, the

commissioner must hold a public hearing

in

every application that

is

deemed complete. The

proposed statutory amendment would

not

apply

in

that instance.

• Conn. Gen. Stat. § 3 8a-16 is a statute that relates to the authority of the Commissioner to conduct

investigations and to hold hearings in aid of any in vestigation on any matter under Title 3 8a of

the General Statutes. SB 159 will not transform insurance regulatory proceedings conducted

und

er

other statutes within Title 3 8a into investigations held under Conn. Gen. Stat. § 38a-l 6.

In addition, SB 159 does not operate to exempt from disclosure this public information nor

does

it

operate to transform regulatory proceedings specified by statute such as involving the

review of

mergers , acquisitions and insurance rates into an investigation or a hearing

in

aid

of

any investigation within the scope of Conn. Gen. Stat. § 38a- I

6.

The

Department

is

committed to providing consumers and public officials with as much information as

possible and will continue to do so

in

the future. For this reason, the Department respectfully requests

that Section 2 of SB 159 be amended consistent with its original wording to express ly provide for the

public disclosure of data that has been aggregated with data provided by other participants in a data call in

a format that does not identify any individual participant.

In I ght of the foregoing, I respectfully ask for your suppor t of SB 159.

Katharine

L

Wade

In surance Commissioner

Cc: Colleen M. Murphy, Executive Director, Freedom

of

Information Commission