March 23, 2012

(Denver) – House Republicans went to bat for big insurance companies today, approving a bill to reduce the amount of money they have to pay on personal injury claims.

HB12-1305 would change the statutory interest rate payable on judgments like insurance claims to 2 percentage points above the discount rate charged by the Federal Reserve Bank of Kansas City. The KC Fed rate is now 1 percent a year, so the state rate would be 3 percent. Currently, the state rate is 9 percent.

The Republicans beat back two Democratic amendments, including one by Rep. Mark Ferrandino, the House Democratic leader, to reduce the maximum interest rate that can be charged in Colorado from 45 percent to 18 percent.

“If we’re going to lower interest rates, we should lower interest rates for all Coloradans,” said Rep. Ferrandino (D-Denver), who noted that the savings would spur consumer spending and boost the economy.

Both amendments died on party-line votes before the bill was approved on second reading.

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