Captives' Product Expansion Snagged
By Caroline McDonald
NU Online News Service, June 19, 3:52 p.m. EST? A group that is pushing to expand permissable product offerings by captive insurers said they would regroup and try again after failing in a bid to bundle that revision into the Senate's terrorism insurance bill.
Any hopes to expand the Federal Liability Risk Retention Act by linking it to the Senate terror bill were dashed when the Senate Parliamentarian determined the bill was "not germane" to S. 2600, the federal backstop bill for terrorism insurance.
Senate leaders eager to finish the bill decided not to allow any non-germane amendments to hold up the process, said Bernard Fulton, who represents the Housing Authority Risk Retention Group, which is a member of the Coalition for the Expansion of the Risk Retention Act.
"We're going to regroup and see if maybe they'll reconsider in conference," Mr. Fulton said. "Otherwise we'll have to either go as standalone legislation or look for some other vehicle. There's not a lot of time left, but we haven't precluded anything."
Mr. Fulton, a legislative consultant with Reno & Cavanaugh in Washington, said the coalition was hopeful risk retention would be added as an amendment to the Senate bill. "We were getting a lot of bi-partisan support from Senators Ron Widen, [D-Oregon], and Conrad Burns, [R-Montana], the bill's co-sponsors." Also, he said the group hadn't seen "any real opposition on the merits of the substance of the provision."
CERRA is an informal coalition of organizations representing consumers, insurance brokers and insurance companies, real estate investment trusts, state insurance departments, and risk retention groups, according to Minneapolis-based Captive Insurance Companies Association.
Expansion of the Federal Liability Risk Retention Act would allow insurance providers?incorporated as either association captives or as reciprocal captives?organized under LRRA to provide more choice and lower rates in the commercial market, CICA said.
The amendments would expand the scope of the act, permitting risk retention groups and purchasing groups, currently limited to offering only liability insurance, to provide all forms of commercial insurance except workers' compensation and personal lines.
CICA's board last week endorsed the proposed amendments to the Risk Retention Act and is joining the coalition, said CICA president Carl Modecki.
"There was actually almost no debate on it," said Mr. Modecki. The board voted to make a financial contribution of $2,500 to the Coalition, he said.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.