While the People’s Insurance Counsel is ready to get back to work, a Maryland state delegate who proposed the elimination of the office still feels it is a “make-work program.”

Warren Miller

Del. Warren Miller (R-Howard Co.) proposed the repeal of the PIC, a division of the Maryland Attorney General’s Office, through HB 144. The legislation would have transferred all of the PIC’s assets and equipment to the Maryland Insurance Administration, which Miller contends is already doing the work of the PIC.

Created four years ago, the PIC was intended to aid consumers in homeowners’ and medical professional liability insurance cases, primarily cancellation or nonrenewal of coverage, premium increases and claims denials and settlements.

Miller told Insurance & Financial Advisor early in this year’s General Assembly session that he did not understand what the PIC did, nor did he understand why the state was set to spend $547,486 to do it. After the bill failed to advance out of the House Economic Matters Committee, Miller said he did gain some insight from the process.

“I learned that [the PIC] is an ineffective, bureaucratic organization that started showing up at hearings after my bill was introduced,” he said. “Their input [at the hearing] was trivial at best and the amount we pay for their existence is extraordinary.”

Work ‘unsexy,’ but aid consumers

Peter Killough, who serves as counsel for the PIC, said the agency is “definitely pleased” the bill failed and is ready to “go back to what we were doing before the bill.”

Killough said his takeaway from facing elimination was threefold.

“We learned that for some, the perception of our office is divorced from reality, that maybe we are not doing enough to call attention to ourselves and that perhaps, there is a misunderstanding of what it is we do,” he said.

He added that at the very same hearing where Miller proposed to colleagues that the PIC cease to exist, consumers testified to the agency’s benefit in homeowners’ cases, including water damage to their homes.

“We respond to consumers with issues, and in this economy, there are a lot. For the most part, we are reviewing filings, which is very unsexy,” he said.

As for the contention by Del. Brian J. Feldman (D-Montgomery) at the hearing that legislators “never see” the agency in Annapolis, Killough said the PIC had a legislative agenda in the works for 2010, but it got derailed by Miller’s bill.

“HB 144 came up and we had legislative agenda we vetted and did research on and were looking for sponsors,” he said. “It is somewhat difficult to find sponsors for bills when someone is trying to get rid of you.”

No defense to keep PIC

Miller said that if the House Economic Matters Committee took up a vote on HB 144 earlier, it would have passed, as the PIC’s hearing presentation was ineffective, at best.

“In a year where the budget is tight and people are struggling to pay their insurance bills, this office is a farce for ratepayers,” he said. “There is not a single thing I heard in their defense that the MIA could not do.”

Miller added that Killough “can defend this half-million dollar boondoggle all he wants.”

And the PIC may not be safe from legislative elimination after all. Miller has announced his re-election bid for another term in Annapolis and has cutting state spending on his radar.

“If I come back and have the opportunity, I will shed light on wasteful government spending,” he said. “We have an excellent example in the PIC. This has nothing to do with ratepayers. It’s a make-work program.”

This story originally appeared in the June 2010 print edition of Insurance & Financial Advisor.