Tennessee: House Passes County Mutual Modernization Bill; Next Stop Is Governor's Desk

The Tennessee House, by a 97-0 vote on May 3, passed Senate Bill 3504, a bill that modernizes the state's county mutual statute, and sent it to Gov. Phil Bredesen, who is expected to sign the bill.

The House vote climaxed a three-year effort by NAMIC and the Tennessee Association of Mutual Insurance Companies to update the county mutual statute. Senate Bill 3504 allows the state's 17 county mutuals to offer broader property coverages and expand their writing territories if they meet certain reserve requirements. In return, the county mutuals will have to license their producers, have their rates and forms approved by the Department of Insurance, and be subject to accrual accounting.

"One of the unique features of this legislation is the creation of a county mutual guaranty fund, where the mutuals agree to an assessment process to pay any outstanding claims of an insolvent county mutual," NAMIC Senior State Affairs Manager David Reddick said.

Senate Bill 3504 passed the full Senate on April 21 by a 31-1 vote.

Direct questions to NAMIC Senior State Affairs Manager David Reddick.

Posted: Monday, May 08, 2006 12:00:00 AM. Modified: Monday, May 08, 2006 10:17:42 AM.

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We are 1,400 property/casualty insurance companies serving more than 135 million auto, home and business policyholders, with more than $196 billion in premiums accounting for 50 percent of the automobile/homeowners market and 31 percent of the business insurance market. We are the largest and most diverse property/casualty trade association in the country, with regional and local mutual insurance companies on main streets across America joining many of the country’s largest national insurers who also call NAMIC their home. More than 200,000 people are employed by NAMIC members.