On March 22, the bill to privatize Pinnacol (HB 21-1213) was defeated in the House State, Veterans, and Military Affairs Committee (commonly referred to as the “kill committee”).
Last year, when it looked like the state would be facing significant post-COVID-19 budget constraints for some time, lawmakers from both sides of the aisle approached Pinnacol with the idea of a 2021 privatization bill. It seemed like a “blue moon” opportunity: The state would divest its interest in Pinnacol in exchange for a much-needed cash infusion, and we would get the freedom to offer our policyholders additional lines of coverage and better coverage in other states.
However, the budget picture kept getting better and better; indeed, the state released its latest forecast March 19, showing a $5 billion surplus (and that is before the new federal stimulus payments come in). Once there was no longer an immediate budget hole to fill, Democrat lawmakers and leadership felt they had no reason to push back against strong opposition to privatization from organized labor and the trial bar.
As a result, we knew the bill would not survive. At the same time, we were honored to have had significant support from the business community for privatization (although most business organizations do not support the idea of a payment to the state).
Even as we continue to seek the statutory flexibility that will free us from state-imposed constraints, we are also exploring other ways to evolve our business to meet the needs of Colorado businesses. And we remain relentlessly focused on providing the industry-leading service our policyholders have come to expect.