HB 2745 — Insurance premium taxes

Summary

Increasing temporarily insurance premium taxes on insurers to fund health insurance premium assistance.

Bill Text

Compared against the Revised Code of Washington as published AI-generated reading aid — verify against the official bill.

This bill amends 2 section(s) of the Revised Code of Washington: RCW 48.14.020; RCW 48.14.0201.

• RCW 48.14.020

  two Beginning two thirty-first → read as follows: (1)(a) Subject to other provisions of this chapter, each authorized insurer except title insurers and registered eligible captive insurers as defined in RCW 48.201.020 shall on or before the first day of March of each year pay to the state treasurer through the commissioner's office a tax on premiums. Except as provided in subsection (3) of this section, such tax shall be in the amount of 2.75 percent of all premiums collected during calendar year 2026, and in the amount of 2.0 percent of all premiums collected during calendar year 2027 and thereafter situated, or to be performed in this state. For tax purposes, the reporting of premiums shall be on a written basis or on a paid-for basis consistent with the basis required by the annual statement. For the purposes of this section the consideration received by an insurer for the granting of an annuity shall not be deemed to be a premium. (b) Beginning July 1, 2023, and July 1st of each year thereafter, the state treasurer shall deposit $7,000,000 in moneys collected for premium taxes pursuant to this section into the Washington auto theft prevention authority account created in RCW 46.66.080. Beginning July 1, 2023, the amount deposited under this subsection must be adjusted by the most current seasonally adjusted index of the consumer price index for all urban consumers as published by the bureau of labor statistics of the United States department of labor. (2)(a) The taxes imposed in this section do not apply to amounts received by any life and disability insurer for health care services included within the definition of practice of dentistry under RCW 18.32.020 except amounts received for pediatric oral services that qualify as coverage for the minimum essential coverage requirement under P.L. 111-148 (2010), as amended, and for stand-alone family dental plans as defined in RCW 43.71.080(4)(a), only when offered in the individual market, as defined in RCW 48.43.005, or to a small group, as defined in RCW 48.43.005. (b) Except as provided in subsection (7) of this section, beginning January 1, 2014, moneys collected for premiums written on qualified health benefit plans and qualified dental plans offered through the health benefit exchange under chapter 43.71 RCW must be deposited in the health benefit exchange account under RCW 43.71.060. (3) In the case of insurers which require the payment by their policyholders at the inception of their policies of the entire premium thereon in the form of premiums or premium deposits which are the same in amount, based on the character of the risks, regardless of the length of term for which such policies are written, such tax shall be in the amount of 2.75 percent of the gross amount of such premiums and premium deposits collected during calendar year 2026, and in the amount of 2.0 percent of the gross amount of such premiums and premium deposits collected during calendar year 2027 and thereafter, t, located, to 31st such premiums and premium deposits computed at the average rate thereof actually paid or credited to policyholders or applied in part payment of any renewal premiums or premium deposits on one-year policies expiring during such year. (4) Each authorized insurer shall with respect to all ocean marine and foreign trade insurance contracts written within this state during the preceding calendar year, on or before the first day of March of each year pay to the state treasurer through the commissioner's office a tax of ninety-five one-hundredths of one percent on its gross underwriting profit. Such gross underwriting profit shall be ascertained by deducting from the net premiums (i.e., gross premiums less all return premiums and premiums for reinsurance) on such ocean marine and foreign trade insurance contracts the net losses paid (i.e., gross losses paid less salvage and recoveries on reinsurance ceded) during such calendar year under such contracts. In the case of insurers issuing participating contracts, such

  amended

• RCW 48.14.0201

  Each → read as follows: (1) As used in this section, "taxpayer" means a health maintenance organization as defined in RCW 48.46.020, a health care service contractor as defined in chapter 48.44 RCW, or a self-funded multiple employer welfare arrangement as defined in RCW 48.125.010. (2) (a) Except as provided in (b) of this subsection, each taxpayer must pay a tax on or before the first day of March of each year to the state treasurer through the insurance commissioner's office. The tax must be equal to the total amount of all premiums and prepayments for health care services collected or received by the taxpayer under RCW 48.14.090 during the preceding calendar year multiplied by the rate of two percent. For tax purposes, the reporting of premiums and prepayments must be on a written basis or on a paid-for basis consistent with the basis required by the annual statement. (b) For all premiums and prepayments collected during calendar year 2026, the tax must be equal to the total amount of all premiums and prepayments for health care services collected or received by the taxpayer under RCW 48.14.090 during the preceding calendar year multiplied by the rate of 2.75 percent. (4) For good cause demonstrated in writing, the commissioner may approve an amount smaller than the preceding calendar year's tax obligation as recomputed for calculating the health maintenance organization's, health care service contractor's, self-funded multiple employer welfare arrangement's, or certified health plan's prepayment obligations for the current tax year. (5)(a) Except as provided in (b) and (c) of this subsection, moneys collected under this section are deposited in the general fund. (b) Beginning January 1, 2014, moneys collected from taxpayers for premiums written on qualified health benefit plans and qualified dental plans offered through the health benefit exchange under chapter 43.71 RCW must be deposited in the health benefit exchange account under RCW 43.71.060, except as provided in (c) of this subsection. (c) The portion of taxes collected under subsection (2)(b) of this section for calendar year 2026 that exceed two percent of premiums and prepayments, must be deposited in the state health care affordability account created in RCW 43.71.130 and used to fund the premium assistance and cost-sharing reduction program established in (10) On or before June 1st of each year, the commissioner must notify each taxpayer required to make prepayments in that year of the amount of each prepayment and must provide remittance forms to be used by the taxpayer. However, a taxpayer's responsibility to make prepayments is not affected by failure of the commissioner to send, or the taxpayer to receive, the notice or forms. (11) The portion of taxes imposed under subsection (2)(b) of this section that exceed two percent of premiums and prepayments must be borne solely by the taxpayer and may not be passed through to enrollees in premiums, rates, plan design, or otherwise, unless the commissioner determines that to do so would create a significant risk of carrier insolvency or consumer harm. A taxpayer shall demonstrate the taxpayer's compliance with this subsection as directed by the commissioner. The commissioner may adopt rules to implement this subsection. --- END ---

  amended

Action History

1. February 28, 2026

   First reading, referred to Finance.

Sponsors

• (Parshley) · Primary

Subjects