10 May 2023Analysis

NRRA warns that Florida RRG bill not dead

The National Risk Retention Association (NRRA) has welcomed the fact that Florida Senate Bill 516 failed to be passed into law last week – but has warned that it might be revived.

In a statement Joe Deems, executive director of the NRRA, told NRRA members that this is no time for celebration, because discussion of resurrection of the bill is already underway.

Deems said that the NRRA continued to mobilise support against the bill and thanked NRRA members for their positive contributions to the campaign so far, as well as Paul Handerhan of the Federal Association for Insurance Reform (FAIR) for his/its proactive support of the NRRA in its opposition to the Bill.

“We are now proceeding into “Phase 2” of our fundraising campaign to reach out and eliminate discriminatory conduct directed at risk retention groups, not just in Florida, but wherever else they may appear”, Deems said. “This is now our opportunity to move forward with that concept.”

According to the NRRA it’s next strategy will be twofold:

First, to begin a vigorous campaign to educate regulators and legislators regarding the obviously negative “spin” suggesting financial unreliability regarding risk retention groups which appears in the ubiquitous “pop-up” that appears every time someone researches any risk retention group through the Florida Office of Insurance Regulation (OIR.­)

Second, it plans to begin immediate discussions with those entities and associations which have been detrimentally affected by the pop-up, which was the motivation for the Bill to begin with, to begin discussions on a suitable endeavour, using means at the NRRA’s disposal, to overcome the negative influence and express assertion that risk retention groups are not “authorised” insurance companies in Florida.

According to Deems: “This false notion is perpetuated by the common misconception created when the word “authorised” is improperly limited to mean companies which are “licensed and admitted” in the state. Of course, risk retention groups remain licensed and admitted in their states of domicile. “Authorisation” is therefore automatic in all states under the federal LRRA, which the majority of state and federal courts have held absolutely pre-empts the use of state laws to interfere with the ability of RRGs to operate in any non-domiciliary states.”

The NRRA will report on further plans as it refines its strategy.