INDIANAPOLIS (May 6, 2005)—The author of a California bill that would mandate insurer community development investments, withdrew the bill from consideration for this legislative session.
Assemblyman Mark Ridley-Thomas, will not pursue AB 925 relating to insurer investments, making the bill a two-year bill, according to NAMIC’s state advocacy partner, the Personal Insurance Federation of California (PIFC). The bill was sponsored by Insurance Commissioner John Garamendi.
NAMIC and PIFC opposed the bill as being unnecessary, unreasonable and impractical.
“The very concept of AB 925 is flawed from a public policy standpoint,” said NAMIC State Affairs Manager, Christian John Rataj. “The bill is unnecessary since the insurance industry already invests a significant amount of money towards urban development and other areas throughout the state of California.”
In 1999, NAMIC concluded that the federal Community Reinvestment Act should not be applied to insurers. NAMIC found that subjecting the industry to an unnecessary government mandate would:
A copy of NAMIC’s paper, Should the Community Reinvestment Act Apply to Insurance Companies can be read on NAMIC Online at http://www.namic.org/policy/cra/default.asp.
AB 925 would have required that each insurer admitted to do business in California with a surplus of less than $500 million to invest not less than one percent of its California allocated surplus. Insurers with a surplus of $500 million or more would invest not less than one percent of California allocated invested assets.
The bill called for community development investments––that have as their primary purpose community development benefiting California low income or moderate income individuals orcommunities––intended to create or retain jobs or create new or expanded business opportunities, in addition to developing affordable housing in various communities throughout the state.
For further information, contact
Rick Nelson, APR (Indianapolis, Ind.)
Founded in 1895, NAMIC is a full-service national trade association with more than 1,400 member companies that underwrite 43 percent ($196 billion) of the property/casualty insurance premium in the United States. NAMIC members account for 44 percent of the homeowners market, 38 percent of the automobile market, 39 percent of the workers’ compensation market, and 31 percent of the commercial property and liability market. NAMIC benefits member companies through advocacy, public policy and member services. Information about the association, its member companies and the property/casualty insurance industry can be found at NAMIC Online. www.namic.org.
Posted: Friday, May 06, 2005 12:00:00 AM. Modified: Monday, September 12, 2005 12:32:01 PM.
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