Today’s issue of WorkCompRecap features some interesting regulatory news from California, as Insurance Commissioner Dave Jones has issued an order that every insurer licensed to write workers’ compensation insurance in the State of California must report their federal income tax savings annually through a rate filing in light of the new tax law.
Jones noted that revisions to the Federal Tax Schedule for 2018 reduced the corporate tax rate from 35% to 21%, meaning nationally insurers could retain more of their premiums as profit. Jones said that any savings should be passed on to California businesses, and the order will allow the Department of Insurance to examine savings and rates, and provide transparency to the public. Insurers will be required to submit rate filings to report the amount of their tax filings annually through 2020, and if they determine there will be no rate impact, must provide a detailed explanation of why.
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