The Nebraska Department of Insurance has announced that it will be withdrawing from the Nonadmitted Insurance Multistate Agreement (NIMA). The agreement is designed to allow participant states to allocate funds collected through premium taxes paid by insurance organizations. States participating in NIMA are meant to pool these funds, which can then be accessed by participants for a number of purposes. Nebraska regulators have chosen to opt-out of the agreement because it does not align with the state’s own laws and timetables regarding new federal changes to taxes and health insurance.
The state has planned to disembark from the agreement by March 5, 2012. Nebraska’s upcoming insurance and tax laws have proven too cumbersome when it comes to participation in NIMA. The Department of Insurance notes that, while the agreement may be practical and beneficial, participation would be impossible at this time. The state’s insurers have been divided on the issue.
Currently, the money the state collects from premium taxes go toward improving consumer protections in the industry and making the insurance industry more efficient. Some of the money is to be used to help the state build a health insurance exchange as well. For the time being, the state will focus on these initiatives rather than take part in a program that would alter these plans significantly. Nebraska may have plans to rejoin NIMA in the future, but has not yet revealed any intention to do so.
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