Jerry Kopel

By Jerry Kopel

Colorado Insurance Commissioner William Kirvan III and deputy commissioner Maryellen Waggoner are gone. Kirvan resigned and Waggoner, a 30-year veteran in state government, retired. This could further complicate Gov. Bill Owens' problems with insurance regulation in 2003, if he is re-elected.

In a recent column, I wrote the Colorado Division of Insurance was automatically repealed July 1, 2002, subject to a one-year period for the division to "wind up" its affairs.

The insurance commissioner is an appointed position. Under Section 23 of Article 4 of the state constitution, whomever Owens appoints has to be approved by the Senate. Since the legislature isn't in session, the governor can appoint someone to "discharge the duties" resulting from the vacancy until the Senate convenes in January, 2003. At that time, the governor must nominate a new commissioner.

The only qualification in the constitution is that the person filling the vacancy be "fit". In dictionary terms that means "qualified, competent, worthy". But the commissioner appointed with the consent of the Senate is required by statute to be "well versed in insurance, an elector of the state of Colorado, with no pecuniary interest in any insurance company or agency directly or indirectly other than as a policyholder."

If Democrats win either the House or Senate, or both, and Owens wins a second term, we will have a major poker game, with each side capable of raising the ante. The battle that led to repeal of the division in 2002 resulted from differences of opinion mainly on health care and no-fault insurance.

Expanding on my previous concerns, Republicans may try to continue the Division of Insurance with its present language by a bill containing a simple reference to the repealed statute. That would put the governor in a better position of power. The Legislative Legal Services office might even provide a written opinion validating that approach. But such a move, in my opinion, would be the worst thing the legislature could do in 2003.

Article 5, Section 24 of the constitution provides "No law shall be revived, amended, or the provisions thereof extended or conferred by reference to its title only, but so much thereof as is revived, amended, extended or conferred shall be re-enacted and published at length."

The division has been repealed. It needs to be "revived". That can only happen with a bill of 500 to 600 pages passed before July 1, 2003. Anything less will leave the division open to all sorts of lawsuits claiming the Insurance Division lacks authority to regulate anything contained in the repealed statute.

There is always a legal presumption that any bill passed by the legislature is constitutional. To overcome that presumption, opponents would cite Article 5, Section 24 of the constitution.

Will a lower court approve a disciplinary action against an insurance licensee before the Colorado Supreme Court has ruled on this issue? My guess is any disciplinary actions would be held in abeyance.

The Sunset language regarding repeal and winding up was in the original Colorado law passed in 1976. I was chief sponsor of that bill, had a hand in its drafting, and have a fairly good understanding of what was meant. The bill could have provided for a hearing and a required first vote two years before repeal, but that wasn't the legislature's choice. It was "repeal and wind up."

The Dept. of Regulatory Agencies prepared the 2001 Sunset review of the Insurance Division. It could, based on knowledge of the resulting disaster of 2002, redo and update its report for the legislature to consider in 2003. Whether that happens is entirely up to Gov. Owens.

(Jerry Kopel served 22 years in the State Legislature)

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