STAND. COM. REP. NO. 2984

 

Honolulu, Hawaii

                  

 

RE:    H.B. No. 994

       H.D. 1

 

 

 

Honorable Shan S. Tsutsui

President of the Senate

Twenty-Sixth State Legislature

Regular Session of 2012

State of Hawaii

 

Sir:

 

     Your Committee on Judiciary and Labor, to which was referred H.B. No. 994, H.D. 1, entitled:

 

"A BILL FOR AN ACT RELATING TO MOTOR VEHICLE INSURANCE,"

 

begs leave to report as follows:

 

     The purpose and intent of this measure is to ensure uniformity and fairness in the covered loss deductible provision of the insurance code by excluding benefits paid or incurred under the workers' compensation law in automobile accident cases from the covered loss deductible requirements.

 

     Your Committee received testimony in support of this measure from the Hawaii Association for Justice.  The Department of Commerce and Consumer Affairs submitted comments.

 

     Your Committee finds that the covered loss deductible provision of Hawaii's insurance code sets reasonable standards for litigation of legitimate claims and discourages frivolous lawsuits in automobile accident cases by deducting the amount of medical expenses from injury awards.  This prevents a claimant who already received a recovery for medical expenses from an automobile insurer under personal injury protection medical coverage provisions of an automobile insurance policy from receiving an additional windfall in recovery for medical expenses in injury awards.

 

     Your Committee further finds that in automobile accidents involving an individual covered under workers' compensation insurance, the workers' compensation policy, and not the personal injury protection medical coverage of an automobile insurance policy, pays for medical expenses incurred as a result of the accident.  Under existing workers' compensation law, the accident victim must repay the workers' compensation insurer for medical, wage loss, and permanent disability payments paid for by the workers' compensation insurer if a judgment, settlement, or award is given to the victim, with payment being deducted from the judgment, settlement, or award.  However, the personal injury protection medical coverage of an automobile insurance policy is also allowed to deduct the amount of medical expenses from a judgment, settlement, or injury award.  This measure addresses this double reduction of awards by excluding benefits paid or incurred under the workers' compensation law in automobile accident cases from the covered loss deductible requirements.

 

     As affirmed by the record of votes of the members of your Committee on Judiciary and Labor that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 994, H.D. 1, and recommends that it pass Second Reading and be referred to the Committee on Commerce and Consumer Protection.

 

Respectfully submitted on behalf of the members of the Committee on Judiciary and Labor,

 

 

 

____________________________

CLAYTON HEE, Chair