FY 2021-22: INSURANCE AND FINANCIAL SERVICES
Summary: As Passed by the House
House Bill 4405 (H-1)
Analyst: Marcus Coffin
Difference: House
FY 2020-21 YTD FY 2021-22 FY 2021-22 FY 2021-22 FY 2021-22 From FY 2020-21 YTD
as of 2/11/21 Executive House Senate Conference Amount %
IDG/IDT $728,600 $724,600 $181,100 ($547,500) (75.1)
Federal 1,017,100 1,017,100 254,300 (762,800) (75.0)
Local 0 0 0 0 --
Private 0 0 0 0 --
Restricted 71,570,000 71,245,900 17,643,500 (53,926,500) (75.3)
GF/GP 0 0 0 0 --
Gross $73,315,700 $72,987,600 $18,078,900 ($55,236,800) (75.3)
FTEs 378.5 388.5 388.5 10.0 2.6
Notes: (1) FY 2020-21 year-to-date figures include mid-year budget adjustments through February 11, 2021. (2) Appropriation
figures for all years include all proposed appropriation amounts, including amounts designated as “one-time.”
Overview
The Department of Insurance and Financial Services (DIFS) is responsible for regulating and promoting the insurance
and financial services industries operating within the state. The department also provides consumer protection by
managing consumer information and inquiries and investigating consumer complaints. DIFS administers and enforces
state statutes pertaining to state-chartered banks and credit unions; mortgage brokers, lenders, and servicers; consumer
finance entities; insurance companies, agents, and products; and health maintenance organizations.
FY 2020-21 FY 2021-22
Year-to-Date House
Major Budget Changes from FY 2020-21 YTD Appropriations (as of 2/11/21 Change
Generally, the House Subcommittee Recommendation appropriates the equivalent of one quarter of the anticipated
annual appropriation. For major budget changes listed below, the quartered appropriations are annualized for
comparison purposes.
1. Regulatory Staff Increase FTE NA 10.0
Executive includes authorization for 10.0 FTE positions, which the Gross NA $0
department has indicated would be used to fulfill departmental GF/GP NA $0
responsibilities related to recently enacted legislation addressing no-
fault auto insurance reform, anti-fraud changes, and surprise medical
billing. The FTE positions would also be used to address increased
volumes of activity in health and auto insurance regulation,
communication, and consumer services. Positions that would be filled
are projected to include:
• 1 Call Center Operator
• 1 Insurance Property and Casualty Filing Analyst
• 1 Education and Outreach Analyst
• 2 Insurance Medical Claims Analysts
• 2 Insurance Examiners
• 3 Insurance Fraud Investigators
House concurs.
House Fiscal Agency 1 5/13/2021
 FY 2020-21 FY 2021-22
Year-to-Date House
Major Budget Changes from FY 2020-21 YTD Appropriations (as of 2/11/21 Change
2. Technical Adjustments Gross NA $0
Executive includes two net-zero adjustments within the budget to align Restricted NA 0
appropriations with departmental regulatory activities: GF/GP NA $0
• Internally transfers $2.4 million in restricted authorization and 10.0
FTE positions from the Insurance Evaluation line item to the
Consumer Services and Protection line item.
• Decreases restricted authorization from the Insurance Bureau Fund
by $2.0 million while increasing restricted authorization from
Insurance Licensing and Regulation Fees by $2.0 million, to align
with regulatory activity. DIFS indicated that the volume of insurance
licensing has increased over the last several fiscal years, resulting
in increased revenue to the Insurance Licensing and Regulation
Fund.
House concurs.
3. Economic Adjustments Gross NA ($328,100)
Executive reflects decreased costs of $328,100 Gross ($0 GF/GP) for IDG/IDT NA (4,000)
negotiated salary and wage increases (2.0% on October 1, 2021 and Restricted NA (324,100)
1.0% on April 1, 2022), overtime increases, increased longevity, higher GF/GP NA $0
actuarially required retirement contributions, increased building
occupancy charges, decreases in other employee retirement costs,
decreases in worker’s compensation, and other economic adjustments.
House concurs.
4. Unclassified Salaries FTE 6.0 0.0
House reduces restricted funding for Unclassified Salaries by $671,900. Gross $820,600 ($671,900)
Restricted 820,600 (671,900)
GF/GP $0 $0
Major Boilerplate Changes from FY 2020-21
Sec. 206. Communication with the Legislature – RETAINED
Prohibits DIFS from taking disciplinary action against employees for communicating with legislators or their staff, unless
the communication is prohibited by law. Executive deletes. House retains.
Sec. 207. Out-of-State Travel – RETAINED
Stipulates conditions when DIFS may send employees on out-of-state travel; limits expenditure of state funds on out-of-
state professional development conferences; requires detailed report on all out-of-state travel. Executive revises to strike
sections delineating conditions under which out-of-state travel is permissible and to modify requirements for information
to be contained in the report. House retains.
Sec. 210. Contingency Funding – RETAINED
Appropriates up to $200,000 in federal and $1.0 million in state restricted contingency funds; authorizes expenditure of
funds after legislative transfer to specific line items. Executive revises to adjust appropriation amounts to $1.0 million in
federal and $5.0 million in state restricted contingency funds. House retains.
Sec. 216. FTE Vacancies and Remote Work Report – RETAINED
Requires DIFS to submit a quarterly report on FTE staffing and a semiannual report on remote work and associated
metrics. Executive deletes. House retains.
Sec. 217. Work Project Usage – RETAINED
Stipulates that appropriations are not to be expended, if possible, until all existing work project authorization for the same
purpose is exhausted. Executive deletes. House retains.
Sec. 218. State Administrative Board Transfers – RETAINED
Stipulates that the legislature may intertransfer funds via concurrent resolution if the State Administrative Board transfers
funds. Executive deletes. House retains.
House Fiscal Agency 2 5/13/2021
Major Boilerplate Changes from FY 2020-21
Sec. 219. Retention of Reports – RETAINED
Requires DIFS to receive and retain copies of all reports funded by the department’s budget, while complying with federal
and state guidelines for records retention. Executive deletes. House retains.
Sec. 220. Report on Policy Changes for Public Act Implementation – RETAINED
Requires DIFS to report on policy changes made to implement public acts that took effect during the prior calendar year.
Executive deletes. House retains.
Sec. 221. Severance Pay Report – NEW
Requires DIFS to report the name and any amount of severance pay given to any high-ranking department official;
requires DIFS to maintain an internet site that posts any severance pay in excess of 6 weeks of wages for a former
employee of any rank; requires DIFS to report on the total amount of severance pay remitted to former employees during
the prior fiscal year and the number of those employees; defines "severance pay". Executive does not include. House
includes new language.
Sec. 222. Prohibition on COVID-19 Vaccine Status Verifications – NEW
Prohibits state entities receiving funding from part 1 from requiring proof of COVID-19 vaccination as a condition of
accessing any state services or facilities, producing COVID-19 vaccine passports, and providing information to other
parties for inclusion in a COVID-19 vaccine passport. Executive does not include. House includes new language.
Sec. 224. Television and Radio Production Expenditure Report – RETAINED
Requires DIFS to report any expenditure of funds to a third-party vendor for television or radio productions; delineates
information to be included. Executive deletes. House retains.
Sec. 225. Insurance Bureau Fund Use – RETAINED
Authorizes Insurance Bureau Fund appropriations for use to support legislative participation in insurance activities
coordinated by insurance and legislative associations, in accordance with the Insurance Code of 1956. Executive deletes.
House retains.
Sec. 301. Health Insurance Rate Filings Report – RETAINED
Requires DIFS to submit a report based on health insurer annual rate filings; delineates information to be included.
Executive deletes. House retains.
Sec. 302. Conservatorship and Insurance Liquidation Funds – RETAINED
Requires funds collected by DIFS in connection with a conservatorship pursuant to section 32 of 1987 PA 173 and from
corporations being liquidated pursuant to 1956 PA 218 to be appropriated for expenses necessary to provide required
services and not to lapse to the General Fund; limits appropriations under the section and Sec. 303 to $300,000.
Executive revises to eliminate the cap on appropriations under this section and section 303. House retains.
Sec. 303. Fees for Customized Listings – RETAINED
Permits DIFS to provide customized listings of non-confidential information to interested parties and to charge reasonable
fees; states that funds lapse to appropriate restricted fund accounts and limits amount appropriated under this section
and Sec. 302 to $300,000. Executive revises to eliminate the cap on appropriations under this section and section 302.
House retains.
Sec. 304. Out-of-Network Billing Complaints Report – RETAINED
Requires DIFS to submit a report on out-of-network billing complaints; delineates information to be included. Executive
deletes. House retains.
Sec. 305. Anti-Fraud Unit Report – RETAINED
Requires DIFS to provide a mid-year update to the Anti-Fraud Unit report required under section 6303 of 1956 PA 218.
Executive deletes. House retains.
Sec. 306. Consumer Services Complaints Report – RETAINED
Requires DIFS to submit a report regarding the amount of consumer complaints received, the process for handling
complaints, and complaint outcomes. Executive deletes. House retains.
Sec. 307. Financial Institutions Marijuana Evaluation Guidance – RETAINED
Requires DIFS to update examination manuals and letters of guidance to reflect how institutions will be evaluated that
provide financial services to businesses involved in the marijuana industry. Executive deletes. House retains.
House Fiscal Agency 3 5/13/2021