RIMS Endorses Surplus Lines Legislation
House of Representatives makes insurance more available and affordable for consumers
NEW YORK (September 9, 2009) â The Risk and Insurance Management Society (RIMS) supports the Non-Admitted and Reinsurance Reform Act of 2009 (H.R. 2571), championed by Rep. Dennis Moore, D-Kansas; Rep. Scott Garrett, R-New Jersey; House Financial Services Chair Barney Frank, D-Massachusetts; and Ranking Republican Spencer Bachus, R-Alabama. Passed by the U.S. House of Representatives today, this important piece of legislation will streamline the regulation of non-admitted insurance and reinsurance, and improve the availability and affordability of insurance for commercial buyers.
âThis vital piece of bipartisan legislation has long been a top priority for RIMS and, while the Society is very pleased to see it make headway in the House of Representatives, it views this as a critical juncture that compels Senate action,â says Deborah M. Luthi, ARM, CCSA, member of RIMS board of directors and director of enterprise risk management services at Matheson. âRIMS views the surplus lines industry as central to the nationâs economic health, and H.R. 2571 will serve to bolster the industry by not only making this insurance more available, but more cost effective as well. It is imperative that the Senate move its version either separately or as part of a larger effort to reform the financial regulatory structure this year.â
Â The Non-Admitted and Reinsurance Reform Act of 2009:
- Allows brokers representing large policy holders to go directly to the non-admitted market to purchase insurance;
- Requires all surplus lines carriers to meet certain financial, capital and other criteria in order to be eligible to provide insurance in states; and
- Preempts state insurance regulators from interfering in reinsurance agreements of ceding insurers domiciled in other states.Â
The legislation also states that in order for commercial insurance purchasers to gain expedited access to the non-admitted market, an insured must employ a âqualified risk managerâ to work with a broker.Â As a result of RIMS lobbying efforts, the original language was modified to provide a broader definition of a âqualified risk managerâ so that most of RIMS members and other risk practitioners will qualify. Â
For more information on RIMS legislative activities, visit www.RIMS.org/LegislativeAction.
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As the preeminent organization dedicated to advancing the practice of risk management, RIMS, the Risk Management Society™, is a global not-for-profit organization representing more than 3,500 industrial, service, nonprofit, charitable and government entities throughout the world. Founded in 1950, RIMS brings networking, professional development and education opportunities to its membership of more than 11,000 risk management professionals located in more than 60 countries. For more information on RIMS, visit www.RIMS.org.
For more information, contact:
Josh Salter, RIMS communications manager, (212) 655-6059 or jsalter@RIMS.org