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SIIA Supports New Legislation to Modernize Contact: David Kirby WASHINGTON, DC, April 15, 2008 – The Self-Insurance Institute of America, Inc. (SIIA) today announced its support for new legislation designed to modernize the federal Liability Risk Retention Act (LRRA) of 1986.
Introduced today, the “Increasing Insurance Coverage Options for Consumers Act of 2008” would allow risk retention groups (RRGs) to write property coverage and would also establish some federal corporate governance standards for RRGs.
“This bill represents an important step toward solving the problems of availability and affordability of commercial property insurance through the United States by permitting alternative risk transfer solutions,” said SIIA President Dick Goff. “The bill also clarifies the LRRA’s federal preemption to assure risk retention groups that they will be able to do business as the original act intended,” he added.
One stated objective of the bill is to “reinforce the foundation of the Liability Risk Retention Act” that allows properly licensed risk retention groups to provide coverage in any state with no interference from non-chartering state regulators.
The bill also addresses several corporate governance standards for risk retention groups that the Government Accountability Office (GAO) recommended in its 2005 study of the RRG industry while concluding that RRGs are a beneficial form of commercial insurance.
Primary sponsors of the bill are members of the Capital Markets Subcommittee of the House Financial Services Committee Reps. John Campbell (R-CA), Ron Klein (D-FL), Dennis Moore (D-KS), and Deborah Pryce (R-OH), who is the senior Republican member of the subcommittee.
Risk retention groups are comprised of businesses or practices that belong to the same industry or profession and become owners-insureds of their own insurance company. Under the existing LRRA, they may insure against the risks of liabilities such as product failure or medical malpractice. SIIA is a national trade association serving companies involved in the self-insurance/alternative risk transfer industry. Additional information about the association can be accessed on-line at www.siia.org, or by calling 800/851-7789. ### |
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