Minnesota: Legislature Passes Report on Bad Faith Bill; Bill Retains Crucial Protections for Insurers, Customers

NAMIC's partners at the Insurance Federation of Minnesota and the Minnesota Association of Farm Mutual Insurance Companies announced that on Monday both the House and the Senate approved by large margins the report of the conference committee that was appointed to work out the differences between the chambers' versions of the bad faith bill. While the governor is withholding official comment on the bill until it has been reviewed, it is expected that he will sign it.

"The conference committee's language is not as strong as the Senate's, but it is the nature of the legislative process for both sides to give and take," said Mark Johnston, NAMIC's state affairs manager for the Midwest. "From our point of view, the retaining of caps on liability and attorney's fees and the keeping of procedural safeguards were essential. During negotiations our allies focused on the most critical issues and protected our members from open-ended liabilities."

According to Joe Thesing, NAMIC's director of state affairs, NAMIC expects this compromise will put the bad faith issue "to bed" for a number of years. "There was always a risk that the legislative environment could have worsened after the November election, which would open the door to far worse legislation in 2009," he said. "We compliment our on-the-ground partners for their hard work. Even more important, however, are the Minnesota company members of NAMIC, MAFMIC, and IFM that responded to the many grassroots advocacy calls that were made. In the end, that was the action that prevented the trial bar from achieving the victory they sought."

Direct questions to NAMIC State Affairs Manager Mark Johnston.

Posted: Tuesday, April 15, 2008 12:00:00 AM. Modified: Tuesday, April 15, 2008 2:01:58 PM.

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