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Committee hears proposal to allow Alaska‑based commercial fishing insurance pools in HB 116
Summary
House Bill 116 would permit member‑owned fishing insurance cooperatives to operate without being treated as insurers under Title 21, aiming to reduce premiums and expand coverage options. Committee heard concept support and agency cautions about capitalization, solvency and legal structure.
The House Special Committee on Fisheries heard a brief overview on March 4, 2025, of House Bill 116, which would exempt Alaska‑based, member‑owned commercial fishing insurance cooperatives from the state's insurance code (Title 21) to allow fishermen to form pools that could reduce premiums and broaden coverage options.
The bill and why it matters: Matt Greening, staff to the committee, told members HB 116 responds to a recommendation from the joint legislative seafood task force and would permit Alaska‑based, member‑owned insurance pools. "Underwriters have been raising premiums on individual vessels and have been increasingly selective of which vessels they insure," he said, adding that three similar pools now operate through an umbrella organization based in Washington state and together cover about 840 vessels.
Support and practical experience: Tracy Welch, executive director of United Fishermen of Alaska, told the committee UFA supports the concept and plans to vet bill language with members. Bob Kehoe, who manages the pools operating out of Washington, explained that pools collect premiums to fund claims and typically purchase an additional insurance layer above the self‑insured layer to protect solvency. "That addresses the issue of solvency," Kehoe said, adding that underwriters view pooled premium arrangements as one way to mitigate risk.
Agency perspective and cautions: Lori Wing Hyer, director of the Division of Insurance, told the committee pools can work but cautioned they do not guarantee lower premiums and that setting up a pool requires capital, underwriting, claims adjudication and legal counsel because vessel claims fall under maritime law. "Can it work? Absolutely. But it's going to take some time to put it all together," Wing Hyer said.
Next steps and process: Committee members discussed whether the state should create a pool versus allowing private, member‑owned pools. Staff said the bill does not itself create a pool but would remove statutory barriers in Title 21 and allow Alaskan entities to form pools. The committee did not take further action on HB 116 at the meeting and postponed public testimony to a later meeting; staff and witnesses said additional research and member vetting would follow.
Ending: Proponents said pools could lower costs and improve access for older or wooden vessels that individual underwriters decline to insure; regulators urged careful design to ensure solvency and adequate claims handling. The committee will take public testimony at a future meeting.
