Date Requested: March 09, 2021
Time Requested: 12:27 PM
Agency: Risk and Insurance Management, Board of (BRIM)
CBD Number: Version: Bill Number: Resolution Number:
2899 Introduced HB3027
CBD Subject: State Personnel


2360 – State Special Insurance Fund; 2363 - Public Entity Insurance Trust Fund

Sources of Revenue:

Special Fund Both funds 2360 and 2363

Legislation creates:

Increases Revenue From Existing Sources, Increases Existing Expenses

Fiscal Note Summary

Effect this measure will have on costs and revenues of state government.

The proposed legislation, upon passage, would require that the Board of Risk and Insurance Management (BRIM) provide additional liability insurance coverage resulting from abolishing most immunities for governmental entities and requiring judgments to be supported by findings of fact and conclusions of law. It would effectively require every claim to either be settled or to proceed to trial. The proposed changes would likely increase the value of settlements and vastly increase the costs of defense. The estimated cost would need to be recovered through a significant increase in premium charged to all insureds to cover the actuarially projected additional estimated claims and claims related expenses associated with the expanded coverage resulting from changing the negligence standard for governmental entities and extending the statute of limitations.

Fiscal Note Detail

Effect of Proposal Fiscal Year
Fiscal Year
(Upon Full
1. Estmated Total Cost 1,500,000 5,000,000 5,000,000
Personal Services 0 0 0
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 5,000,000 5,000,000

Explanation of above estimates (including long-range effect):

The primary reason for the increase in the estimated costs/expenses for FY2021 and future fiscal years is a result of both the additional number and amounts of claims resulting from the expanded coverage being created and from eliminating governmental entities ability to seek to utilize qualified and other immunities as a bar to suit. In addition, this change could not have been anticipated in the FY2021 premium for FY2021 charged to governmental agencies likely resulting in a premium deficiency for the fiscal year. Depending on how it is implemented, it could also impact the costs of occurrence periods prior to FY2021. Beginning with FY2022, additional premium would have to be charged to insureds to recover the estimated additional estimated claims and claims related expenses for fiscal years FY2022 and going forward. BRIM’s actuaries were not able to provide any estimates of the additional projected cost estimates. However, it would be reasonable to assume that significant additional insurance costs would be incurred by all governmental entities impacted by the proposed legislation. Note: The estimates provided are conservative and could be much higher depending on how the proposed legislation is implemented.


    Person submitting Fiscal Note: Stephen W. Schumacher
    Email Address: