By Ed Sealover | The Sum & Substance
Gov. Jared Polis’ pitch to convert Pinnacol Assurance into an independent company is being driven not just by money it could generate for the state budget but by the belief that failing to loosen the company’s operational restrictions could jeopardize its sustainability.
The Democratic governor sat for an interrogation before the powerful Joint Budget Committee on Wednesday about his plans to address a nearly $1 billion budget shortfall, including $638 million in expense cuts and revenue additions he has proposed. Among the most prominent and controversial of those suggestions is a proposal to allow the state-chartered workers’ compensation insurer of last resort to act as a private company, which could add $100 million to next year’s budget and more in future years.
Legislators created what is now Pinnacol in 1915 and exempted it from state and federal taxes that other insurers pay in order that it would offer workers’ comp policies to every Colorado company, even those deemed too high-risk by private insurers. However, its current structure limits Pinnacol’s to selling policies only in Colorado and selling only workers’ comp plans, and those two restrictions now are costing the company business.