17 April 2023Analysis

NRRA launches fightback against Florida bill

The National Risk Retention Association (NRRA) has announced that it is organising a fightback against the passage of Florida Bill 516 in the State Senate.

The Florida House Commerce and Senate Appropriations Committee hearings took place on April 10th & 12th respectively. However, the NRRA said that it’s campaign efforts in opposition are already beginning to show some progress.

“Following four volleys of NRRA opposition letters to the involved committees, including most recently the Senate President, House Speaker, as well as the new Insurance Commissioner, NRRA has already started the “ground” campaign and needs your help,” the Association said in a statement to the market.

The NRRA said it has partnered with Paul Handerhan, president of the Federal Association for Insurance Reform (FAIR). Handerhan has joined forces with Lewie Pugh, Executive Vice-president and legislative spokesman for the Owner-Operator Independent Driver’s Association (OOIDA), and Linda Allen, a small independent Florida Trucker. Together, they collectively undertook our oral opposition presentations to the Bill at the two hearings this week.

“While House Commerce on Monday voted unanimously to approve the Bill, the Senate Appropriations Committee hearing (on Wednesday, April 12th), prompted by our opposition testimonies, generated a number of very probing inquiries by some of the senators relating to their need to know more information as to how and why this bill will damage numerous local businesses (including truckers), or how risk retention groups (RRGs) seem to be operating in all fifty states without the need for any rating(s) as to quality or size of capital surplus,” said the NRRA. “While the Bill passed, it was not unanimous, and even some supporters” acknowledged that they needed to know more.”

The NRRA said that if passed, Florida Bill 516 will have a ‘devastating impact’ on not only trucking and transportation risk retention groups registered in Florida, but actually every RRG writing commercial liability, including auto. This could also arguably impact 96% of the RRGs registered in Florida. Hundreds, if not thousands of RRG owner-member-insureds could lose their coverage. The Bill’s passing may also open the door to other significant potential threats to risk retention groups in other states and for other types of risk retention group entities.

NRRA Executive Director, Joe Deems, announced that the Association has developed a platform for financial support based on three phases of ongoing activity:

Phase One – Presently ongoing campaign to communicate with and educate legislators as to the inherent flaws in the bill. The purpose will be to persuade an “amendment” to the Bill that will work. Estimated cost at this point: $12,000.00 (including staff travel.)

Phase Two – Depending on Amendments actually adopted, an ongoing campaign to develop favourable agreements with multiple state agencies impacting the need for liability insurance from RRGs. Estimated Cost will be in the range of $75,000.00 - $90,000.00.

Phase Three – If all else fails and the bill passes with the current damaging language, to commence litigation to enjoin enforcement of the bill and challenge it under the federal law preempting such activity under the LRRA. Estimated Cost would be $150,000.00 to file and pursue the case in federal court, not necessarily to include appellate review at the federal 11th Circuit level, and potentially before the Supreme Court.