Insurance companies rally against Bill 167 - KUAM.com-KUAM News: On Air. Online. On Demand.

Insurance companies rally against Bill 167

Posted: Updated:

by Krystal Paco

Guam - Sixteen years ago lawmakers pushed to promote economic development on island through the creation of a captive insurance company industry resulting in the issuance of QCs on premiums.

Fast forward to today and lawmakers are looking to remove the tax exemption following recent findings from the OPA that the program is too generous.

"I'm very well aware of contractual obligations between the government and private sector, between two individuals for that matter 0856 so legislation can't undo contracts, I know that 0900 so when I introduced Bill 167, it was primarily because of Governor Calvo's response to the Public Auditor's report of the whole qualifying certificate program was that he's been asking the Legislature to remove the QC program for health insurance companies," said Senator Rory Respicio.

But insurance companies aren't buying it and banding together in opposition of Senator Respicio's Bill 167 - legislation that would undo a 16-year-old tax exemption program on premiums collected by insurance companies.

According to Ray Schnabel, the chairman of the Insurance Association of Guam, such legislation is risky business. "The health insurance industry has already had to pass on rate increases to its customers for Obamacare mandates. It now faces the new mandates for 2014 and without the necessary mitigating provisions of the rest of the law. Now on top of large increases from GMH that we're faced with we also have to pass on the expense of the gross receipts tax as intended by this bill."

He predicts the end result would force customers to disenroll from the ranks of insured to uninsured and ultimately pass the burden onto GMH's growing non-paying population.

Joining him in opposition, First Net Insurance's Nancy Tan says the proposed legislation does little to evaluate the industry's contribution to the local economy.

She said, "The program has leveled the playing field and as a result benefits the entire community in 2003 the insurance industry paid more than $185 million in claims following Typhoon Pongsona. It is unmistakable that without participation in the QC program that the domestic insurance industry would have not been able to sustain losses of this magnitude."

Acknowledging the Public Auditor's recent findings on the qc program relative to insurance companies, Staywell's Francis Santos said, "I think what's in question that I found kind of enlightening is that I didn't know that one company got five separate QCs to me, that's the government's fault. Why didn't they look at that economic disadvantage to our government and our territory?"

Although Guam Medical Association president Dr. Thomas Shieh supports the bill, he questions the legality of removing QCs.

"Perhaps you can amend the legislation that enough is enough. No more QCs," he said.

  • NEWS HEADLINESMore>>

  • Shops take Hafa Adai Pledge

    Shops take Hafa Adai Pledge

    Joining the ranks of hundreds of other local businesses and organizations. Several shops took the Hafa Adai pledge today during a ceremony Tumon. The owners of Halia and Jade, Suprim Denache, Coconut Tree Company, and Café de Sirena.More >>
    Joining the ranks of hundreds of other local businesses and organizations. Several shops took the Hafa Adai pledge today during a ceremony in Tumon. The owners of Halia and Jade, Suprim Denache, Coconut Tree Company, and Café de Sirena.More >>
  • Man arrested for two fake checks at Pay-Less

    Man arrested for two fake checks at Pay-Less

    An incident took place at Pay-Less involving fake checks. Court documents state 31-year-old Gerard DeGuzman Belga allegedly cashed a fake check at the store's Yigo location over the weekend. Staff didn't realize it was a counterfeit - evidenced by how "huMore >>
    An incident took place at Pay-Less involving fake checks. Court documents state 31-year-old Gerard DeGuzman Belga allegedly cashed a fake check at the store's Yigo location over the weekend. Staff didn't realize it was a counterfeit - evidenced by how "huMore >>
  • Decolonization commission holds final meeting of Calvo administration

    Decolonization commission holds final meeting of Calvo administration

    The last meeting of the Commission on Decolonization took place today with the Governor thanking members for their service. While some members tendered their courtesy resignations because of the incoming administration, the respective status option task fMore >>
    The last meeting of the Commission on Decolonization took place today with the Governor thanking members for their service. While some members tendered their courtesy resignations because of the incoming administration, the respective status option task fMore >>
Powered by Frankly