Insurance firm hopes to break from Colorado
Legislative committee’s study may let it become independent
By GARY HARMON
The state’s largest carrier of workers’ compensation insurance is hoping to take advantage of an interim legislative committee study of its operation to gain full independence from the state.
Pinnacol Assurance was targeted in the last session of the Colorado General Assembly by legislators hoping to get some of its $500 million surplus to resolve some of the state’s budget difficulties.
The move to appropriate Pinnacol’s surplus failed, but the Legislature did appoint an interim committee to study the company, which was established by the state in 1915.
For the past 20 years, Pinnacol has operated as a mutual insurance carrier, and the interim study committee might offer an opportunity for it to be completely independent, the company CEO said.
“We believe we ought to be allowed to complete the journey and not be allowed to just operate as, but actually be, a mutual insurance company,” Chief Executive Officer Ken Ross said Friday in a call with reporters across the state.
The outlines of such an independent company haven’t been fully filled out, and the board of directors, which is appointed by the governor, has yet to take a position on whether
Pinnacol should pay, as do other insurers, a 1 percent tax on premiums.
Pinnacol has been spared the tax because it is the state’s insurer of last resort. It can’t turn away business as other carriers can do with high-risk customers.
“None of our competitors have that obligation,” Ross said.
Employers by state law are required to carry workers’ compensation insurance.
During interim committee hearings, Ross said he expects to hear from injured workers and from business customers.
During those hearings, he’ll stress that Pinnacol this year, for the fifth consecutive year, returned a dividend to customers and has reduced the rates companies pay for coverage.
Action by the committee isn’t expected until the final meeting in October, and that would result in bill proposals to the full Legislature.