It was explained that such cards had been approved to pay workers' compensation indemnity "lost time" claims and an insurer had asked to expand the program to permit payment of all property and casualty claims by using the prepaid card.

In lieu of mailing settlement checks to the claimant, the insurer proposed issuing a prepaid Visa card to a claimant on a voluntary basis.

The claimant may opt to receive payment by other methods, such as by check, if for any reason the claimant does not wish to receive the prepaid card.

The maximum amount that an insurer may load on the card is $25,000. The maximum cumulative amount that the claimant would be able to withdraw from an ATM per day is $1,000.

However, the claimant could withdraw the total amount available on the card by requesting a cash disbursement through a participating bank, via an over-the-counter withdrawal. The inquirer reports that a participating bank is one that has a relationship with Visa.

The department said the insurer said providing claimants a card offers advantages over payment by check, such as immediate access to funds, savings of cash checking fees, and access to millions of ATMs and Visa merchants, 24-hour toll free bilingual customer support as well as security from theft or loss.

The insurer told the department the program would benefit claimants who either have no bank accounts, are unable to obtain a credit card on their own, or who make little use of banking services.

Also, the carrier argued that issuing cards would reduce the fraud exposure from handling checks and significantly lower their cost of claim operations.

The program involves a variety of ATM fees. It will provide free automated phone inquiry service and live call center support, according to the department.